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ReaperKK said: "Hello everybody, I found these forums on google and I thought that they may be able to help me. Some background info I am 18 years old and make $1000 a month. I have one credit card with a limit of $250 and I have not been late and paid off everything on this card for the six months I've had it. I live with my parents and the only bills I pay are cell phone, insurence, and credit card. Anyways here is what I wanted to know, I have saved up $4500 for a new car (my car now is a beater and I need to get a new one FAST, repairs are just to much for me when I can try and get a newer car (2002 or newer)) Anyways yesterday I went and checked my credit score and I have a 609 FICO credit score. I wanted to know if it would be possible to get a $6000 for a new car. I don't want my parents to co-sign because they don't have the best of credit so I was hoping that I could get the loan. Also can I take a higher interest rate and then refiance the car later when I have better credit? I'm willing to pay a higher interest rate cause of my bad credit I just need a car for work and school. So tell me is it possible or am I still screwed? Thanks for the help."
anchorbob said: "Hi and welcome!
You have $4500 for a down payment and a 609 Fico? I don't think you should have too much of a trouble at all with a loan as long as your income is okay.
Have you started looking?"
ReaperKK said: "Yeah I started looking and I found a 2002 VW Golf, it would be perfect for me, it only has 40k miles and is 10k so I was hoping I get a loan. I'm going to go check oit out today at the dealership. Thanks for the help by the way."
JoshJohnson said: "Just tell the car dealership exactly where you stand and I bet they'll work something out. The need to sell cars."
carsan956 said: "as an ex f&I manager for a dealership, banks require for you to make a minimum of 2000 per month. finance at least 10000 dollars, being employed the last two years, residence stability, and at least 5 years credit history. Other than these, you more than likely need a cosignor or shop for a first time buyers program."
SLCKev said: "From what you're saying ($1,000 income per month) I'd buy a used Honda or Toyota (Reliable) even if it was a little older and pay cash for it. Buy from a Private Seller and check CarFax to assure it's solid, ask to see the maintenance records and take it to a mechanic that you trust to look it over before you finalize the deal. This is a conservative approach. You can avoid car sales people that way and get a better deal."
credit_card_collector said: "When they ask your income I figure you could say "do you mean household income" and they will probably say yes, then just include your parents income when figuring it. That is an ok score for 'scoring' (I so funny) a car loan, maybe not at the best rate, but you hit the nail on the head, just refinance in a few years. I am afraid I have to agree with some others in this thread, but to whip out the dad hat, you only make 1k per month and are still in school you want to take out a what? 32, 48, 60 month loan on a used 10k car? You live at home. I have been here to, most of us here have. Do not bite off more then you can chew early it will hurt your credit for a long time if you do not pay timely payments. My guess is that you will be headed off for college and you will have to quit the 1k per month job and even if you don't go to college you will want your own place sooner or later and will have the car payment on top of your rent or mortgage payment. I would seriously consider the option someone else in this thread mentioned, get a good car that will be dependable for the cash in your pocket and do not have those huge car payments hanging over your head the rest of your life. I would suggest a simple econobox Chevy or Ford they are usually very dependable and the newer ones can be had for the cash you have on hand. Good Luck I wish you the best whatever your decision. Let me explain a story, I hope you wake up like I did. When I was 18 and had no credit (I could not even get a credit card) I was approved through Greenpoint credit for a mortgage at a very very bad rate (since we know Greenpoint went belly up due to giving loans to very bad candidates like me) well I picked out the home and gave the down payment, I woke up before I completed the deal and my dad helped pull my ass out of the fire and helped me get my down payment back. I am very glad I waited (have a home now paid off) because when I look back on it I know I would have failed miserably and would still have horrible credit and the home would have been repossessed by now I am sure, I would have nothing. I only made 1k per month like you. I would have had house payment, gas, electric; you know teens gotta have cable, in other words screwed living in a home with no furniture or utilities soon to be repossessed. On another note about the Econobox dependable car for cash. When I started driving I bought a Dodge Omni for less than 1k that had 90k miles on it but lots of power options and AC. I tell you what there was never a better car deal in the history of the world, I drove that thing non stop for years, put 200k miles on it, at one time drove 100 miles one way to work every day and it held up great, I have a new car now but I still own the Omni and its still running, so cheaper cars can be just as good just maybe not as pretty. :)"
jrmoro said: "[QUOTE=ReaperKK]Hello everybody, I found these forums on google and I thought that they may be able to help me. Some background info I am 18 years old and make $1000 a month. I have one credit card with a limit of $250 and I have not been late and paid off everything on this card for the six months I've had it. I live with my parents and the only bills I pay are cell phone, insurence, and credit card. Anyways here is what I wanted to know, I have saved up $4500 for a new car (my car now is a beater and I need to get a new one FAST, repairs are just to much for me when I can try and get a newer car (2002 or newer)) Anyways yesterday I went and checked my credit score and I have a 609 FICO credit score. I wanted to know if it would be possible to get a $6000 for a new car. I don't want my parents to co-sign because they don't have the best of credit so I was hoping that I could get the loan. Also can I take a higher interest rate and then refiance the car later when I have better credit? I'm willing to pay a higher interest rate cause of my bad credit I just need a car for work and school. So tell me is it possible or am I still screwed? Thanks for the help.[/QUOTE]
First of all congratulations on saving $4,500.00. Most customers that come to me for automobile financing are lucky that they have two nickels to rub together!
Here's the concerns most lenders will have.
1) Most lender will not give you an automobile loan unless they finance at least $7,500.00
2) Most lenders want a minimum income of $1,200.00 a month before taxes come out. (Gross income)
3) Your credit score is under 620 and most lenders want to have you over that score.
Now having said all that, you might get a personal loan and the lender will use your car hostage with a lien until the car is paid off.
You might consider getting a little less expensive car and pay cash and not worrying about car payments at this time of your life.
As a father of two and a Finance Manager at a automobile dealership for more that 15 years, I would recommend paying cash and enjoying the freedom of being debt free! Good luck with your decision! :)"