Credit Advice

Have a question? Have advice to share? The combined knowledge and experience of everyone in the Credit Karma community can help you. Enter your question or help others below to get started!

Question

Posted in Auto Loans
Profile Image

Question By
sidscorp

0 Contributions
0 People Helped
Get a loan or not?
I have a score of 716 (creditkarma). I can put down 8k for a car. However, I'm considering getting a loan of about 4k and getting a nicer(?) car. I'm trying to decide if I should do that or not. I'd like to understand what factors I should be considering before I make the decision. I'm 23 and I've had my license for a few months, so I'm guessing my insurance rates are going to be high and I'd like to keep my car payments to about 50-100 per month.

Your Credit Scores Should Be Free. And Now They Are.

View your scores and reports anytime.

SIGN UP NOW
All Responses

Result 1-1 of 1Results per page: 5 | 10 | 25Page 1 of 1   Previous | Next
Top Contributor
5038 Contributions
1136 People Helped

First, keep in mind that lenders will have age and mileage requirments on the vehicles that they are willing to finance, the age and mileage will also affect the length of time that they will be willing to finance for, thus will affect your monthly payment. Second, spend time shopping around for auto insurance, as a new driver you will likely get some high rates, but really spend some time shopping as it can save you a lot of money to find the right company for you. If you are getting the loan just to help your credit, make sure that the lender will report to all three credit bureaus (some lenders do not report to any, some will just report to one) which would defeat the whole purpose of getting the loan if you are doing it to help your credit. Make sure that you get a Fixed rate loan where the rate will stay the same. Don't pay attention to your Karma score as lenders do not use it, see what your Fico scores are, as they will most likely be the ones pulled for your loan. Remember that lenders use more than a score to determine your eligibility and rate, they will look at your overall credit profile, debt to income ratio, etc. All in all, I think your idea is fine. Keep in mind, when building credit that revolving credit, such as credit cards, plays a bigger role than installment loans. 

Result 1-1 of 1Results per page: 5 | 10 | 25Page 1 of 1   Previous | Next

Your Credit Scores Should Be Free. And Now They Are.

View your scores and reports anytime.

SIGN UP NOW

Reply to this Question

Write your response:
Enter Your Comments

The Credit Advice pages of the Site may contain messages submitted by users over whom Credit Karma has no control. Credit Karma cannot guarantee the accuracy, integrity or quality of any such messages. Some users may post messages that are misleading, untrue or offensive. You must bear all risk associated with your use of the Credit Advice pages and should not rely on messages in making (or refraining from making) any specific financial or other decisions.