First Car Tips and Advice
Owning a car involves several expenses. There will be the obvious monthly car payment and insurance, but do not forget gas and maintenance. You should have an idea on how much the insurance, gas and maintenance will cost. What is left is the size of the monthly payment. Even if you can afford, say $400 a month, you don't need to spend the whole $400. Set your budget at $300.
Find out how much car your $300, or whatever your budget is, will buy. Ideally your first car loan should have a 36 to 48 month term. The idea is to pay this first car off quickly so you can go buy the next, better car. To determine how much car you can buy, remember this number $30 per $1,000. For each $30 of payment you can buy $1,000 worth of car.
You will need assistance to qualify for your first car loan. This is called a co-signer. If you mess up and can't make your car payments, the co-signer gets to make the payments and you cause problems for both your's and your co-signer's credit ratings. If your parents belong to a credit union, go in and talk to someone about getting your first car loan. Credit unions can be very helpful in getting your credit history started. Otherwise you get to take your co-signer down to the dealership and work out a credit arrangement there.