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new2credit02

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I want to buld my credit, I can buy a car right out or should I do payments to help build?
New to credit, oldest account only 6 months old.

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It may be difficult for you to find a decent rate with thin credit. You could check into dealerships that deal with "bad credit, no credit", but be aware that there would be "Hard Inquiries" which would ding your scores and most likely you would not get a good rate. They may also want you to have a cosigner. Also, many things go into a lender's decision in addition to your credit scores and full credit reports. Things as the time you have been with your current employer, year and mileage of the car, etc. The best advice here would be to tell you to get a cheap car for cash and work to build your credit before you decide to finance an auto. Credit cards count more for building credit anyway. The basic credit building tools are three credit cards and one installment loan. You can get a secured card and small secured installment loan to get started if you need to. The amount of the loan does not matter. Get your credit built up and in good standing so you can get an easier approval and a good rate. Make sure that you spend an adequate amount of time reading all that you can on credit. It is info that will help you for the rest of your life.

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Making payments will help build your score. You just need to weigh your options. Paying cash is going to save you the most money obviously. But will do nothing for your credit score. Getting a loan will help your score as long as you don't miss a payment. But your interest rate is not going to be the best since your credit score isn't very high. So just figure out if you want to spend a few extra bucks to help raise your score or not.

Also, you could put down a large down payment upfront and have smaller monthly payments. That way you will be paying less interest because the principal is lower. This way you would still have a loan that would help with your credit score. Don't expect it to help your score right away. As you pay down the amount you owe your score will increase. But once you pay off the loan completely your score will drop a little because you are no longer using that credit.

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