Shopping for a used car as my 1st car
So if I'm interested in like trying to buy my first car,
what kind of deal can I get. Like do I need to make
a down payment at first and then pay each month
on how much you and the dealer agreed on? Help
Talk to your bank or credit union to see what you can afford.
You can take out your own auto loan from a bank, or you can buy a car from a "buy here, pay here" dealer, but those types of dealers are only setting you up with a loan from a lender typically with high interest rates. The dealers get a cut of those interest rates for setting up the loan, and they get paid that cut up front. If you default the lender will repossess the car. New car dealers tend to have their own lenders (like GMAC for GMC trucks, for instance), they tend to have better rates BUT you need a good credit score to qualify. If you have non-existent or bad credit, your going to have a hard time to find a lender and you may need a co-signer as well. The worst place to shop for a car is in the poor neighborhoods at the "buy here pay here" places. Those are sucker deals with APRs as high as 24% or even higher, you'll be paying thousands in just interest alone, not to mention they tend to inflate the price of the car alot but they make it appear affordable because they get the monthly payment down low - by dragging the loan out for 60 months or more. If you have money saved up, try buying from a private seller, and be sure to run a carfax on the car so you don't get screwed, or talk to your own bank about getting pre-approved for a loan, or talk to a new car dealer about a lease, some leases have rates as low as $88/month with a couple thousand down, granted at the end of the lease you have to turn car in or buy it or go into another lease, but at least then your covered with a good warranty. If you know someone with some car buying experience, take them with you when you go to buy, first time buyers are easy prey for those sucker loans. Be sure to read over the terms, and don't sign it until you do - what they tell you and what is on paper aren't always the same thing.
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