Auto Loans for New Buyers: Financing Cars the Smart Way

posted on Monday, April 26, 2021 in Financial Tips

Purchasing a car for the first time is a great milestone in life. However, it also entails a huge financial responsibility. If you’ve been planning to buy your first car but are slightly short on cash, consider applying for car loans. Be sure to check out these tips on how you can increase your chances of getting approved for one. 

Establish a Good Credit History

Having a good credit standing gives you more leverage when applying for a loan. If you’re not in a rush to buy a car, focus on improving your score first. Some ways you could do this include paying credit card debts and making sure you meet deadlines for monthly payments. These give lenders the impression that you’re capable of repaying a loan. 

Find a Suitable Lender

Understandably, not everyone has a good credit standing, but that doesn’t mean you can’t get approved for a loan. There are financial institutions like credit unions that offer programs for applicants with limited credit, like young adults. Make sure to also ask lenders if they have first-time buyer programs as these may have better rates and lower monthly payments. 

Consider Getting a Cosigner or Co-Applicant

Cosigners are individuals who will take the responsibility of paying the loan in case you’re not capable of doing so. Anyone can serve as a cosigner as long as they have a stable monthly income and good credit standing. However, it’s important to note that this individual will not have any rights to the vehicle.

Co-applicants, on the other hand, share the same responsibility for repaying the loan. They’ll also have equal rights to the vehicle. In most cases, family or friends fill this role.

Drive Your Dream Vehicle in No Time!

At Community 1st Credit Union, we offer auto loans at affordable rates. Whether it’s your first or second time buying a car, we’ll walk you through the application process. Aside from automobiles, we also provide loans for other types of vehicles like motorcycles, boats, travel trailers, and motor homes. If you have questions or concerns regarding our services, please reach out to us today!