As recent college graduates we may be starting our lives in the workforce, as well as our financial lives. We must learn to live on a budget, and we must start building a good credit. However, it may be difficult to start building good credit if we have no credit history. Having a good credit history can determine whether we are approved for our first mortgage, if we are offered our first job, and if we get approved for our first car loan.
How can I get a car loan if I have no credit?
We need to have a good credit history to be approved for our first car loan, but we need to effectively manage our credit in order to build a good credit history. It is the chicken and the egg complex. Which came first? The credit or the good credit history? The truth is, we do have options to get our first car loan approved; even if we have no credit history through a No Credit Car Loan.
What is a no credit car loan?
A No Credit Car Loan is a loan that is provided to consumers who have no credit history. The interest rates are generally higher on No Credit Car Loans than interest rates on car loans from car dealerships or financial institutions. The interest rate may be higher on a No Credit Car Loan, but at least our car loan will be approved. The interest rates on No Credit Car Loans are higher because the finance company assumes more risk on consumers that have no previous credit history.
Is it better to have bad credit or no credit?
It is better to have no credit than a bad credit history when applying for a No Credit Car Loan. Bad credit shows a bad past pattern of not repaying our debts on time. However, no credit allows us to start establishing a new credit history. Students or new immigrants often have no credit.
How Can a No Credit Car Loan Help My Credit History?
A No Credit Car Loan is a great way to start establishing our credit history. No Credit Car Loans are designed for people who may have no previous credit history, for whatever the reason. However, once the loan is approved and we start making monthly payments on time it establishes a good credit history.
The high interest rate on No Credit Car Loans in the short term is worth it to establish a good credit history over the long term.
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