You’ve test driven a few cars and now you’re looking to buy the one that meets all your expectations. Well, that’s great. But, there’s one small problem – in order to secure a car loan, you need to possess a good credit history.
Do you?
Well, if you don’t, there’s no need to panic. There are a few options that are still available to you.
Co-Signing
You can always secure a loan by co-signing. Co-signing is basically a practice wherein you sign up for the loan along with a trusted friend or family member who has good credit. This friend or loved one will sort of serve as a guarantor because they have good credit.
So, if you have someone who’d be willing to do that, you’re sorted. However, if you don’t, you can try out the next option.
Go for a Credit Building loan
If you really, really want the car and don’t mind paying extra, you can go in for a high-interest loan. There are plenty of lenders out there who are willing to offer loans to people with a poor/non-existent credit history. The only catch is that you’ll have to pay extremely high-interest rates.
But, it’s a fair deal considering that you’re getting what you want and the lender is covered via the interest payments.
However, we suggest you think about this option a hundred times before you go for it.
Pay cash
The third option is probably the safest option, which is saving up for the car and paying cold, hard cash. It’s the most rewarding option because you won’t have to worry about making monthly payments, poor credit, or loan rejections.
In fact, if you’re willing to wait, the prices may come down and you can even negotiate with the dealer. In the end, you might just save some of the money you’ve set aside for the car.
However, don’t get too excited. This is the toughest option among the three because it requires you to delay gratification and make changes to the way you spend and manage money.