Simple as that, will my age affect my APR on a car loan (looking at about 3500-4000), I'll be 18 when I get the car and I DO NOT have a credit card, so I really don't have a credit history.
I guess also, how much will my APR vary Based on my credit rating/history, by the time I get the car I will have had a credit card for about two months with it being paid off every month.
2007-01-29 08:28:05 · 13 answers · asked by nasonguy 3 in Cars & Transportation ➔ Buying & Selling
Your age will not affect your APR, but a lack of credit history will. You will most likely qualify for a "first time buyer" program with most any bank. This typically involves a 15% downpayment, and a somewhat higher interest rate - 14% APR is about right. 2 months of credit history is not enough to help you out, you will still be treated as a first-timer.
A cosigner will do wonders as far as lowering your downpayment. I'd suggest hitting up mom/dad/grandma for a signature. Just make sure you pay your loan on time or else that will cause lots of issues for both of you.
A few things that will affect APR -
your personal credit history
the age of the car
the miles of the car
the length of the loan
Another rule, credit unions almost always have lower rates than banks, as they are taxed and run differently. DO NOT go straight to a dealer and apply. Finance managers at dealers are commissioned salespeople, and they get paid (among other things) by how much profit they can make on a loan. As a general rule, take someone experienced and try to find a car from a private seller. Have it checked out thouroughly before buying. Get pre-approved with a bank or credit union and see what you qualify for.
2007-01-29 12:49:42 · answer #1 · answered by steve k 2 · 1⤊ 0⤋
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2016-09-26 21:51:17 · answer #2 · answered by Marcela 3 · 0⤊ 0⤋
Yes, your age will affect the interest you will pay on your car loan, but so will 'other factors,' such as 'how' you buy the car (from an agency that sells only new cars, to 'from a person who is not a dealer placing the ad' online or in the newspaper. Your 'good credit rating' from having a credit card and paying it off every month for two months won't be 'worth much' when you buy THIS CAR, but it WILL AFFECT your 'credit rating' in the FUTURE, so BE CAREFUL when you are looking for a car to buy, and be sure that you KNOW the 'interest' you'll have to pay in both PERCENTAGE points and how 'long' your loan will last, and be sure that you 'double check' because many 'big loans' like you'll be looking for have HUGE PAYMENTS at the end that are almost as much as that car was worth when you first bought it, and you don't want to have to pay that money out if you can find a 'better loan' somewhere else for a similar car.
2007-01-29 08:44:27 · answer #3 · answered by Kris L 7 · 0⤊ 0⤋
Probably not too much. Since you have low credit or no credit, you're looking to to pay probably at least 12% apr on the loan. Now that might change if you have a co-signer that has established good credit, or you put a high down payment on the car. Also, try opening an account at a credit union and apply for a car loan there. I just bought a car and got offered 7% at the dealership, I applied at a credit union and got half that rate 4.25% (although the 3 year monthly payments were too high and opted for a 4 year at 5.25) Again, you might need a co-signer if you don't like the apr they're offering. Good luck, you gotta go shopping around for things like this.
2007-01-29 08:37:21 · answer #4 · answered by Fred L 3 · 0⤊ 0⤋
Well, the credit card may make a difference since you are paying it off each month. But only 2 months is not a lot of time. Just by what you said you are looking to borrow, sounds like it is a used car. Usually used cars have a higher interest rate to begin with. And your lack of credit will also probably add to the rate. A co-signer with good credit will help lower it. But, personally, I would rather pay the higher rate than to involve someone else. And after the car is paid off, you will have established a credit rating all by yourself. A good thing.
2007-01-29 09:34:13 · answer #5 · answered by just me 6 · 0⤊ 0⤋
By law age can not be held against you. But that does not mean that they can not find another reason to stop you from getting a loan.
2007-01-29 08:32:32 · answer #6 · answered by is4031_us 4 · 0⤊ 0⤋
There is a saying when it comes to credit!
No Credit is Great credit!
Good Luck! Don't Settle for High APR's!
'-)
2007-01-29 08:32:53 · answer #7 · answered by Anonymous · 0⤊ 0⤋
yes and no. to get a car note u must be at least 18. the rating and age of your credit does effect whether or not u qualify and at what rate.
2007-01-29 08:50:41 · answer #8 · answered by Miki 6 · 0⤊ 0⤋
Exactly. Your debt ratio will affect your interest rate.
2007-01-29 08:36:13 · answer #9 · answered by Anonymous · 0⤊ 0⤋
age does not, your credit score does....
also your debt to wage ratio has a lot to do with it-
hence debt to wage ratioe is how much money do you earn compaired to how much you have in bills.
2007-01-29 08:34:39 · answer #10 · answered by 4Real 4 · 0⤊ 0⤋