Financing for First Time Car Buyers

Posted Tuesday, Nov 17, 2020

First Car No Credit

Getting a car in Phoenix with no credit is one of the most complicated processes that first-time car buyers usually undergo. Saving up a down payment is one of the simple things you can do to ensure that you get a Phoenix car loan. Your chances of getting a car loan would be much better if you have a large down payment.

The process of a down payment is to demonstrate your commitment to the purchase and shows that you have been investing. But there is nothing to worry about, as Premier Used Cars and Trucks is here to help you get your first car even if you do not have a credit score. Auto financing, just like mortgage lending, got tougher for those Americans with low credit after 2008.

With the improvement that has been witnessed in various parts of the country, a number of lenders have opted to loosen their reigns and expanded their access to auto financing. That would be the good news about this entire matter. On the other hand, those who have credit issues will have to pay a premium for financing to take care of the heightened risk of the lender just as it is normal with other loans and mortgage.

The Process of Buying Your First Car in Phoenix with No Credit

Fetch as Much Information as You Can

Your credit history in Phoenix is one of the main factors in getting approved for a car loan. When you do not own any credit history, the lender would be forced to search in other sources just to make sure that you will be able to afford the car payment. To substantiate your history, you should be able to gather the following documentation.

The first one you would need is a copy of your bank statement. You will also require a proof of employment history, and in most instances, multiple pay stubs would be appropriate. Documentation of any kind of reoccurring bills like a phone bill or utility bills. The documents listed up above would just confirm if your account is in the best form.

Consult your Friends and Family

When you have no credit, the other best place to start looking for help on how to finance your first car is through friends and family. If they are not in a position to offer you the whole loan, then they can possibly co-sign on the loan.

A co-signer is basically a person, apart from the borrower who assumes an equal liability for the loan by signing a promissory note. In other words, you would be using another person’s credit score to buy a vehicle. The co-signer will be forced to pay lest they watch their credit score suffer.

Remember, apart from damaging the credit score of your family member, a late damage would also damage the relationship you have with your friends and family. The best thing to do is to first make an agreement to set an interest rate as well as a time frame for the repayment. Making payments on time is another best thing to do in as far as this whole matter is concerned.