Auto Loans For College Students
By Pat Morgan
These days, it is easier for college students to purchase their own car. Many lenders, and even car manufacturers, now specialize in tailor made auto loans for college students.
For a college student, especially one who has not yet established a credit record, it is certainly very simple to obtain a car loan if you have a co-signer. By asking a parent or guardian to cosign the loan, you are able to receive the funding much quicker and possibly lower your interest rate, assuming the co-signer has a good credit rating. This is an excellent way to assist your college age child and still give the student the responsibility of making the monthly payment. When your loan is co-signed it means that if you fail to make the payments on time, your co-signer will be held responsible and the lender will ask that person to pay.
If you are a college student with debt and little credit, it will be difficult, but not impossible, to obtain a loan without some type of guarantor or collateral. There are many financial companies with websites that do offer bad credit college student loans, but you will pay a much higher interest rate. However, no matter what your credit might be, if you make your payments in full and on time, in about a year you can apply for car loan refinancing and receive a lower interest rate for your auto loan.
Also, try making as much of a down payment as possible, at least 20% of the purchase price. Not only will this lower your monthly payments, but it will show the lender that you are serious about this purchase as you have some of your own money tied up. You may also be able to find some dealers or manufacturers who are offering rebates for students. At the very least you can ask for this and may get some type of discount.
Finally, consider the type of car you are purchasing. I know a sports car is every college students dream, but you have to consider the additional costs involved, over and above the actual purchase price. Insurance is extremely expensive for a brand new hot sports car, and gas is outrageously priced these days. Your best option is to go for a simple, reliable, economical car, as your first purchase. Establish your credit by making your payments on time and when you graduate you will be able to get the car of your dreams.
About the author
If you're in the market for a college student car loan, check out my site where you can get information on every type of auto loan, including bad credit new car loans. Pat Morgan is a retired auto dealer finance manager from Austin, Texas, who has started a blog to help people with bad credit obtain car loans. from http://www.FreeArticlesAndContent.com
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