| Getting a first time car buyer loan has never | | | | you. |
| been easier. But there are a lot of pitfalls that you | | | | Do you have any money down?o With the |
| need to be aware of. | | | | market being so competitive today a lot of |
| I sell cars in Phoenix, AZ and I often give this | | | | lenders will approve you for no money down. But |
| illustration to people looking for a first time car | | | | a good rule of thumb to remember is that every |
| buyer loan: | | | | $1,000 down translates into roughly $20 to $25 a |
| Imagine your new neighbor comes over one day | | | | month in payment. AND if you put no money |
| and knocks on your door. You answer it and he | | | | down you will be paying interest on sales tax and |
| blurts out, "Can I borrow $25,000? I know you've | | | | your license plate! |
| got it and I really need it to buy a car. You can | | | | What is your monthly income?o Lenders will |
| trust me to pay you back!" | | | | usually only allow a certain percentage of your |
| In an over-simplified way that's what YOU are to | | | | income towards a car payment. So the more you |
| a car lender if you've never made a major | | | | earn the more you can borrow (typically). |
| purchase on credit before and are looking for a | | | | A Pre-Approved First Time Car Buyer Loan Is |
| first time car buyer loan. You are an unknown | | | | The BEST Way To Purchase a Vehicle |
| person asking for a large sum of money and | | | | Being pre-approved for a first time car buyer loan |
| there is no way of proving (because you have no | | | | means you know exactly how much vehicle you |
| lending history) you will pay it back. | | | | can afford, and what the banks rules are about |
| Truth is, being a first time car buyer is nearly as | | | | the vehicle (typically less than 5 years old and |
| bad as having bad credit. 10 years ago getting a | | | | under 50,000 miles). So you are free to look for |
| first time car buyer loan was virtually impossible | | | | the vehicle that YOU want. This makes the |
| without a co-signer. But times have changed and | | | | shopping experience fun and exciting, which is |
| so has the car industry. The marketplace is so | | | | exactly what it should be! |
| competitive now that lenders are really stepping | | | | As a car salesperson I like getting people who are |
| up to help first time car buyers. And one of the | | | | pre-approved. Because together we can walk |
| best ways to do this is through pre-approval. | | | | through the lot looking at vehicles we know they |
| Pre-approval puts YOU in the drivers seat! With | | | | can afford, going over options, features, etc. and |
| that check in hand you can walk onto the car lot | | | | picking the one they like best! |
| with confidence, spend time looking at several | | | | Before You Charge Off To Get Pre-Approved |
| vehicles and choosing the one that you really | | | | Here's Some Helpful Advice |
| want! | | | | If you don't have a co-signer then pick one or |
| There Are Two Types Of First Time Car Buyer | | | | two lenders and apply to them ONLY. Don't hit 10 |
| Loan Misconceptions | | | | or 12 at once thinking you can "shop the rate." |
| The first one I mentioned above. Wanting too | | | | You are a first time car buyer! First time car |
| much car! I work at a Chevy dealership and in | | | | buyer loan interest rates are all close to the same |
| Arizona everybody wants a truck! So I routinely | | | | amount. And 1/4 of a percent isn't going to make |
| get 18 to 20 year olds who want trucks that | | | | or break a payment. |
| cost $20,000 or more. | | | | Once you're pre-approved use that lender. Don't |
| Then there is the other type who thinks the | | | | let the dealership talk you into "checking your |
| banks will only lend them a small amount so they | | | | credit for a better interest rate." Again, you are a |
| come on the lot looking for a $4,000 cheapie. | | | | first time buyer! Most lenders will charge close to |
| In the first scenario the person is not budgeting | | | | the same interest rate. So once you're |
| for their future. Lenders know that although you | | | | pre-approved look for vehicles that fit within the |
| might not be paying rent, utilities, etc. today, you | | | | amount the lender is giving you. |
| probably will during the life of the loan so they | | | | Budget For A Warranty And GAP Insurance |
| won't let you go overboard with a high payment. | | | | Warranties protect you from those high mechanic |
| Trust me! They don't want that car back in a | | | | bills. Cars today have so many computer chips in |
| repossession when you can no longer afford the | | | | them that it can cost a lot for repairs. Heck even |
| payments! In the second scenario the person is | | | | something as minor as a broken window motor |
| being overly budget conscious. What they don't | | | | can cost over $400! |
| understand is that the lenders want to make sure | | | | In the case of a total loss accident GAP will pay |
| you are in a good vehicle that will probably only | | | | the difference between what the insurance |
| require general maintenance. They know that you | | | | company gives you and what you owe so that at |
| are more likely to make your payments on time | | | | least you walk away from an accident with a |
| if the car is running great and you don't have a | | | | zero balance. |
| huge mechanic bill to budget for! | | | | If the lender approves you for $15,000 |
| This is why getting pre-approved for a first time | | | | remember that you will need at least $2,000 to |
| car buyer loan is so great! You will know | | | | $3,000 of that for GAP and warranty so shop |
| EXACTLY how much you can afford and get the | | | | accordingly. |
| best vehicle in that price range! | | | | There Are Two Types of First Time Car Buyer |
| So What Will Lenders Give You? That Depends | | | | Lenders |
| On A Several Things. | | | | Lenders that give you a "blank check" you can |
| Do you have a co-signer with a strong credit | | | | take to any dealership you like. |
| history?o When it comes to first time car buyer | | | | · If you like seeing, touching, feeling and |
| loans lenders like co-signers because they know | | | | driving a vehicle before you buy it |
| that the other person will always come through if | | | | · If you're shopping for a used vehicle. |
| you can't, their credit history proves that.o PLUS | | | | This way you can shop the dealerships and find |
| since a first time car buyer typically has a zero | | | | the best used vehicle in your pre-approved price |
| credit score the interest rate is determined by | | | | range |
| how strong the co-signers credit is. This could | | | | AND lenders that work through pre-approved |
| mean as much as a 10% lower interest rate for | | | | dealerships to find the right vehicle for you. |