Comprehensive Auto Loan Tips For First Time Car Buyers
Age and status dont matter when it comes to buying a car
. Car is a requirement for every American. Most automobile purchases are made with the help of car loans. When you buy a car for the first time, you may have several doubts. But, once you know the entire car loan process, it will all be very easy for you.Buying your first car is a great experience and you shouldnt get overwhelmed. A first time buyer needs to get a first time auto buyers loan. This car loan program can be availed by a teenager, a college student, or a person with no credit, a good credit borrower etc. The only common factor among first time car buyers is that they are buying a car with auto loans for the very first time.
Criteria for Getting Approval on First Time Auto Buyer Loans
1. Employment
Your job plays a major role in getting a first time auto buyers loan. You can be employed part time or full time but, you will definitely need employment proof. You can show your recent pay stubs as a proof. If you are self-employed, you can use your tax statements as proof.
Lenders have simple logic when they ask you to have stable employment. If you have a regular job, you will be able to make timely payments. This will increase safety of lenders investment.
2. Income
Income and employment are very closely related. When you have stable job, you are able to earn a regular income. Most lenders require you to earn at least $1,000. This number changes according to the lender.
Income is an important criterion because you can make regular payments to the lender only when you earn enough. If your income is insufficient to pay your expenses, getting a first time car buyer loan is not a good idea.
3. Credit Rating
Your credit score determines your credit repaying ability. Lenders are able to know your financial history by taking a look at your credit report.
Now, it is always better to know your accurate credit score. Before applying for a first time auto buyer loan, you must check your credit report and remove all errors and mistakes. If you find any discrepancy in your credit report, you must inform to the respective credit bureau.
Higher the credit score, better it is. So, work on your credit score.
4. Down Payment
Down payment has a very significant relation with your car loan approval chances. When you make a substantial down payment, you reduce the auto loan amount. This increase lenders trust and decreases his doubts and risks. Making a down payment of 10%-20% can significantly reduce your interest rates.
5. Co-Signer
Co-signer is a person who guarantees the car loan by signing the auto loan agreement along with the primary borrower. Though co-signers are not compulsory, a co-signer adds significant weight to your first time buyer car loan application. You can actually avail higher amount of loans at lower rate of interest when you have a co-signer.
All these factors are important in getting first time auto buyers loan. When you apply for a car loan, you have to convince the lender of being a low risk credit borrower. If you can do, instant approval will very easy for you.
All the best!
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