Posted Tuesday, Nov 17, 2020
Purchasing a car for the very first time can seem like a daunting experience. Not only are there so many cars to choose from, but you also need to make sure you can afford the vehicle. Another thing you need to take into consideration is that as a first-time buyer, it might be harder for you to obtain first time buyer auto financing. You will find that this is especially true if you lack any substantial credit history. Luckily, you can get financed for your first vehicle in three simple steps.
The first thing you need to do to obtain a loan for your first vehicle is to calculate your budget. You should never walk blindly into a financing deal without knowing where your budget stands. Take the time to sit down and work out your financial situation carefully. Working out your budget will allow you to determine how much you can afford regarding monthly car payments. Kelley Blue Book suggests that you base your calculations on the fact that you will pay $25 for every $1,000 you need to borrow based on a 48-month loan term.
When you apply for auto financing for the first time, the lender will ask you if you have an idea of how much you are looking to spend. Calculating your budget will allow you to provide a number that you are comfortable with. Also, you may be able to spot expenditures in your budget that you do not need. For instance, you may feel that you can cut back on certain activities to have more for a monthly payment on a car.
When you apply for first time buyer auto financing, you do not want to make the mistake of not knowing what type of vehicle you want. A dealer cannot help you find a car that best suits you if you don’t even know what is best for you. Take the time to determine the type of vehicle you need. For example, do you need something to get you back and forth to work or school? Do you need something to haul you and your large family? Perhaps you need something to haul tools and equipment each day. The type of vehicle you need will vary based on how and why you will use it. Although the idea of cruising down the road at top speeds in a cherry red Ferrari 458 spider might sound appealing, it is probably not a practical choice.
A typical 2 or 4-door car would be a good choice as an everyday vehicle that you use to travel back and forth to work or school. If you have a large family, you may want to consider something larger with more room such as a minivan. If you find yourself hauling equipment and tools on a daily basis, opt for a pickup truck. Identifying your vehicle needs will make life easier when you finally look to obtain first-time car financing.
As a first-time buyer, you have plenty of options regarding finding funding. For instance, you may opt to go through traditional lending institutions such as a bank. You may also visit a conventional car dealership. Keep in mind, however, that either of those options may prove somewhat difficult if you have no credit established. As a first-time buyer, lending institutions and car dealerships cannot determine your trustworthiness, which makes it harder for you to obtain auto financing your first time around.
Luckily, there is another alternative. Buy here pay here, or BHPH car dealers are far more lenient with their funding. They typically work with people who have little to no credit so that they may obtain first time buyer auto financing and a car that they want and need. If you find that banks and traditional car dealers refuse to fund you for your first vehicle, do not skid off to lick your wounds just yet. Instead, contact a reputable BHPH financer.
In addition to working with you, BHPH professional can offer a significant measure of convenience. They provide you with their personal financing, meaning you do not have to go through a lengthy approval process to get auto financed and drive away with the vehicle you want. In many situations, people can drive away with a car the same day they go in and apply for a first-time car loan.
Although you may pay a higher interest rate on the vehicle compared to traditional banks and car dealers, the interest rate is only slightly higher. Some might have you believe that BHPH dealers charge an exorbitant amount in interest rates, but that is simply not the truth. Reputable dealers provide you with fair rates and a relatively easy way to obtain financing.
If you wish to learn more about obtaining auto financing as a first-time buyer, contact Premier Used Cars and Trucks and ask about ourfunding terms. If you are located near Premier used Cars and Trucks, schedule an appointment to go in, or stop by and speak to someone and potentially test drive a few cars. Either way, you are sure to find both the funding you need and a car that you want.