It should be stated, first thing, that a lot of young Americans don’t have excellent credit. That’s not an indictment on the youth of the United States, but more a result of how the whole system is set up.
Your credit is calculated and then listed as a score. Your credit score can vary, depending on who is running the report, but for the most part your report will be fairly accurate. What goes into the calculations to determine your score? Well, there are a series of factors.
Have you paid your bills on time? Have you made purchases on credit before and did you pay those on time? Your credit is something that you earn over time, and unfortunately for a lot of younger people, they just haven’t been around long enough to establish good credit.
There are some ways to bump up your credit or at least establish some points. Speak with your lender about what they recommend for your area. You can also get a credit card, charge a few small things, pay it off when the bill comes, and that will help you as well.
Once you have some kind of credit, the buying process will be a lot smoother. The Credit Union usually offers better rates to customers with better credit. You will also have more buying options and can be approved for a nicer car as well. It is not advisable, however, to get dealer financing. The rates are a lot higher and you will miss out on the personal attention and service you get from the Credit Union.
If you are a first-time car buyer, don’t get discouraged. Talk with a loan representative from the Credit Union about what you want to buy and what you can afford. Part of their job is to assist you, and remember, everyone was a first timer at one point in their life.