Your credit score and Interest rate go hand in hand so I’ll break down your best options based on the following credit score ranges…
- You will qualify for the best deals
- Find a Credit Union for the best rates
- New cars are good to buy when you can find a 0% interest deal. Just back sure that interest rate doesn’t change after a number of months
- In most cases, it’s almost always best to buy a 2-year-old car to get out of all the depreciation hits that a car takes in the first 2 years.
- The deals you see in ads for $199 a month are almost always leases.
- A lease is structured for you to finance a portion of the car with those lease payments. Automobiles depreciate about 40% in 3 years, so if your lease payments don’t pay for 40% of the car at the end of the lease, you’ll be upside down. We haven’t even talked about settlements for dings or mileage overages, etc. The dealer will usually let you roll those problems into another lease or a new car but the only way to get out of a bad situation is to walk away from the bad deal after it’s over and then to start a buying new transaction. A debt coach almost never thinks a lease is a good deal for anyone!
- This range can usually get a 2-3% interest rate
- We suggest that you get a 2-year-old used car if your interest rate is going to be above 5% for a new car.T
- At this range, especially near 620’s, you’ll start to find banks that won’t handle the loans.
- We suggest a 2-year-old used car at this score.
- Your options are limited at this score range
- Buy here, pay here lots are an option but it will be expensive and it won’t help you build your credit one bit!
- If you have to have transportation then bite the bullet on an inexpensive car and get ready to pay high-interest rates through companies that handle risky loans. This is a better option than the buy here, pay here lots because you will be building your credit if you pay your payments on time.
Watch Out for the Finance Guy at the End
- Don’t add anything to your loan/lease while you’re in front of the finance guy. NOTHING… no extended warranties, no upgrades.
Maintenance Can Cost You Dearly
- Educate yourself through car fact websites and publications to know which cars historically have problems and which require little maintenance. This will save you a ton of time, money, and hassle over the life of your car.
A Debt Coach Offers Car Buying Advice for Free. No Strings Attached!
A Debt Coach offers credit counseling services to people who are experiencing credit and debt problems! We create customized plans with your budget in mind and deal directly with your creditors. No gimmicks, no funny business! Both the Government and your creditors are happy that we are here to help you solve your financial problems. Other than a small one time fee to get started and some fees that cover transaction expenses, we don’t ask for anything else in compensation from you. We are mainly paid by your creditors to provide this service.
About A Debt Coach
A Debt Coach is a Non-Profit Credit Counseling Agency that helps consumers find options available for the financial problems they face. We offer credit counseling services to clients across the country who are experiencing credit and debt problems. A Debt Coach offers one of the most beneficial debt consolidation programs in the nation and we have provided counseling and advice to more than 200,000 consumers since 1992.
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