Nothing is worse than being late to class because of car trouble. Making tuition, getting to class on time, and holding down two jobs are all part and parcel of a student’s daily life; And you shouldn’t have to add ‘Mechanic’ to your list! (Unless you are going to school for that, of course.)
But what are you options for financing a car that can reliably get you to class on time? Auto Approved helps students get approved to help get them back on the road. (Even students with bad credit!)
HOW TO QUALIFY FOR A STUDENT AUTO LOAN?
Just because you’re just starting out, doesn’t mean you shouldn’t be able to get financing for your next car purchase. Unless you’ve been planning ahead and building your credit, the chances are you don’t have any credit yet.
So, can you get an auto loan without credit?
The answer is yes, with a few contingencies. To explain, we need to think like a bank for a minute. As you might already know, banks determine a borrower’s creditworthiness based on three factors:
• Credit - the documented history of an individual’s ability and willingness to repay debt.
• Income - The amount of money an individual earns or receives, usually calculated monthly
• Employment - Most commonly as an employee or self employed.
While credit is the most important factor, a student auto lender may be willing to look past a blank credit report if they saw a solid employment history and a steady income. In some cases, a lender may be more willing to loan to someone without credit history before they loaned to someone who has been delinquent on payments in the past. So if you are a first time car buyer but have a solid job and documentable income, the next step is to calculate your payment to get an idea of what to expect.
Calculate Your Payments
Finding out how much you are able to pay towards a loan is a great first step to take in the car buying process. Use a car payment calculator that allows you to determine what size payment is right for you based on your income. It’s important to understand that just because you qualify for a payment, doesn’t mean it’s right for you. Make sure you stay within your means and don't take on a payment that is too high for you, especially on your first car.
Apply For Financing
Once you have gotten your paperwork together, applying for your first loan is the easy part. Our application takes about 15 minutes to complete, and you can get a response pretty quickly. We accept applications from everyone, and we approve loan applications from people with all types of credit. Getting an approval back on your first auto loan can be exciting, and it will let you know what kind of terms and conditions you are approved for. So get to work and hit the APPLY NOW button to get started.
Save Up For A Downpayment
As part of your approval you may have been given an estimated down payment to expect at closing. Down payments are oftentimes one of those necessary evils of financing your first car. Down payments are an added security for the lender that the borrower will do their best not to default on their loan. By requesting a downpayment (which is usually a percentage of the car’s purchase price) a lender can help offset other risks like a lower credit score or intermittent job history. Often times, the greater the risk associated with a loan the greater the down payment will be requested.