Auto Loan, Student Loan, & Financial Aid Help?

Question

I'm currently thinking of applying on all three this summer. I have a full-time job but seeking to replace with a part-time job to pay my bills and make room for school. I plan on applying for 2 loans: $10,000 for auto and another $15,000 on student loan. I have limited credit history of 8 months with a credit score ranging from 640-660 maybe even at 680 due to regular payments on my 2 credit card bills. I've had my current job for a year and a month but working here won't get me anywhere that is why I decided to further my career by going back to college. I am also currently applying for my financial aid as a full-time student to help out with school's tuition and expenses. I could probably deal with $400-500 a month payments for the two loans and I have minimal payments for my living and misc expenses. But would this be a good decision? I need experienced individuals to advice and give suggestions pls. Thank you very much!

Answer 1

Well, a couple of things you might want to consider.

First, your credit score is in the average range so don't expect a very good interest rate, especially on an auto loan. With you credit rating as it is, don't let anyone try and sell you a car loan with an interest any higher than 7 or 8. If a dealer does, they are trying to take you to the cleaners. Find financing somewhere else if that happens.

Second: A bank is going to look at whats called your "debt to income" ratio. Its the difference between what you make and the payments you make on your debts and if they feel that your debt to income ratio will be too high, they they might deny you a loan or charge you high interest rates.

Third: Student loans are a whole different animal when it comes to loans. Most "student" loans can be set up so that you don't have to start paying on the principle until you graduate. The catch is that some banks will make you start making payments on the interest right away and only the principle is deferred.

You mentioned that you might want 10,000 for an auto loan. You can find a really nice used car for WAYYY less than that, something that isn't a beater or an eyesore. You could easily get something like a 02-04 Honda Civic for half that and it wont cost you an arm and a leg to operate.

I applaud your decision to go back to school. It will open opportunities that weren't there before.

Whatever you do, be smart and don't stretch yourself too thin. Good Luck!

Answer 2

I was on the same situation and this site helped me HTTP://HELP.CREDIT-SOLUTIONS.INFO

RE Auto Loan, Student Loan, & Financial Aid Help?

I'm currently thinking of applying on all three this summer. I have a full-time job but seeking to replace with a part-time job to pay my bills and make room for school. I plan on applying for 2 loans: $10,000 for auto and another $15,000 on student loan. I have limited credit history of 8 months with a credit score ranging from 640-660 maybe even at 680 due to regular payments on my 2 credit card bills. I've had my current job for a year and a month but working here won't get me anywhere that is why I decided to further my career by going back to college. I am also currently applying for my financial aid as a full-time student to help out with school's tuition and expenses. I could probably deal with $400-500 a month payments for the two loans and I have minimal payments for my living and misc expenses. But would this be a good decision? I need experienced individuals to advice and give suggestions pls. Thank you very much!

Answer 3

1

Answer 4

If you are going to defer your student loan until you graduate then you can take out the auto loan. Try to pay off the auto loan before you graduate so that you don't have to pay student loans and an auto loan at the same time.

Also, if you are not really in need of a car right now you can put off getting the auto loan and focus on the student loan and pay it while in school. You don't want to have a lot of open accounts because the more credit accounts you have open, it makes your credit score decrease.

Answer 5

The first thing you need to know is how much you can actually afford in payments as opposed to how much you think you can deal with. The other thing you need to do is prioritize.

First it seems to me that your student loan and financial aid is more important than having a nicer car (you could get something decent to get you to school and back for much less than 10K if you shop around right). Depending on your financial status (income, parental help, net worth, etc) for your student loans, you can also get loans that will help you with limited living expenses as well, so you might want to look into what you can get as far as student loans before you look into the other, if you are frugal, your student loan might help with your car payments. The interest rate will be more favorable than any car loan, and if you are a full time student in most cases you will not start making payments on your student loans until 6 months to a year after graduation or discontinuing your full time schooling.

The other thing to remember is that car dealerships will allow you to bury yourself in debt. They will not take your schooling or other into account when convincing you of the right car for you and "Of course you can afford this really nice car at 20% apr, look how low the payments are...". Take a voice of reason with you when you go and someone who knows about cars. Research on the internet when you find a car you like and make sure you are getting the best value.

Good luck!

Answer 6

For school apply for a Stafford loan, they are not due or should say payment are not due until 6 months after you graduate (or drop out) and can be stretched out for 20 years. Talk to the finance counselors at your school. They are generally available to anyone well students that is. Congratulations on going back it is a wise move. By the way at 48 I went back and yes got the loans, and finished with a BSBA last year while working full time with a 3.57 GPA Good luck to you

Answer 7

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RE:Auto Loan, Student Loan, & Financial Aid Help?

Answer 8

Not a chance. You won't get a loan based on financial aid -- which is SUPPOSED to be used to pay for your educational expenses. To get a car loan, especially one that large, you'll need proof of steady, regular income -- in other words, a JOB.

Answer 9

Taking a loan (yes every expenditure on credit card is a loan and has to be repaid with interest) and defaulting on repayments, doesn't go well with credit card agencies. When they find that a default on repayment has taken place, they increase the APR's, take back all rewards and slap late payment fees. This also doesn't goes well with the credit rating agencies. Read more from: http://www.credit-card-gallery.com/article/268,3_worst_student_credit_card_mistakes_that_cause_most_of_the_credit_card_debt

Answer 10

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