Click Here for Featured Specials
Randall Reed Family Owned & Operated Since 1992
Buying your first car can be very exciting. Whether you're heading to college, commuting to work, or taking your family on a road trip, if it's your first time buying a vehicle, you might need some help. One option could be to enroll in a Ford first-time buyer program. First-time buyer programs help people with no credit, or poor credit, buy their first car. Read on to learn how to buy your first car and how first-time buyer programs can benefit you.
One of the first decisions to make when buying a new vehicle is deciding what will best fit your lifestyle and goals. It can help to think about your absolute needs in a car, such as seating for a particular number of passengers. Consider the car's age (if it is used) and how long you want it to last without expecting significant repairs. Of course, the price of the car and your budget are also important factors.
Other important factors might be fuel efficiency if you have a long commute, travel frequently, or your local environment. For example, you might need a vehicle that will be reliable in snowy or icy conditions or one that can cope with muddy, rocky, or sandy terrain.
Next, you can consider optional features you’d like in your vehicle. For example, a high-definition rear-view camera or heated and ventilated driver's seat might not be deal breakers. Still, they could be perks you’d like to have. Deciding on some of these optional features might help you narrow down your choices from the many available to you.
A good next step, unless you are paying cash in full, is to prepare financing for your vehicle by checking your credit score and correcting any errors.
Suppose it’s your first time buying a vehicle or other major purchase, such as a house. You may not have experience of how your credit score can impact your financing options. When you want to buy a car, your lender will evaluate your credit report to decide what loan terms to offer or whether to provide you with a loan at all. Your credit history also plays a role in the terms that lenders are willing to offer. As a first-time buyer, you may have good credit but little credit history, which can impact your financing options.
Your credit score results from a formula being applied to your financial data. This financial data can include your bill-paying history, late payments and credit history if you have one. Credit bureaus, such as Equifax and Experian, apply a formula to this data to produce a credit score.
While the most commonly used formula comes from FICO (originally Fair, Isaac, and Company), different bureaus may use different formulas. There may also be errors in your credit history, which can affect your credit score. That’s why it’s a good idea to check your credit report before you apply for a loan.
When setting your budget, you should consider factors beyond your monthly income. Your vehicle will also require maintenance at some point, which may be sooner or later, depending on the condition you buy it in. There are also other fees, such as registering the vehicle, that you can consider.
When you buy your car, you can use cash and pay for the vehicle in full, or you can get a loan and pay gradually. When getting a car loan, you can pay an amount toward the cost of the car in order to reduce your monthly loan payments. This is called a down payment. The amount of down payment you can afford is also something to consider when setting your budget. Car loan terms are typically between two and seven years. Because your loan will accrue interest, you could pay more over an extended repayment period.
First-time buyer programs are special financing options for people who are buying their first vehicle. They are designed with the understanding that when someone buys their first car, they may not have a long credit history or a good credit score. Such programs can result in you getting a car loan when you might not otherwise meet the criteria set by the lender.
First-time buyer programs may be available from a lender, such as a credit union, or an auto manufacturer. First-time buyer programs don’t rely on credit history and score the same way typical auto loans do. They set other requirements instead. Your ability to participate in a first-time buyer program may be dependent on your income, work history, and whether you have a co-signer. There may also be restrictions on which vehicles are eligible for the program.
You may need to accept specific terms to join a first-time buyer program. For example, you might have a required minimum down payment or maximum loan term. You may also need to provide a certain number of pay stubs proving your employment history and salary information. Some programs require references; others may want to see paid utility bills proving your address. You also might need to bring someone with good credit who will co-sign on your loan. A co-signer is a person who agrees to take over payments on the vehicle if you are unable to.
First-time buyer programs offer opportunities for people to own their first vehicle and build their credit for future purchases. There are a lot of great vehicles in Dallas for first-time buyers. Are you looking to buy your first car? Talk to our team and review our first time buyer program.
Photo Credit: Image by Jessy Smith is licensed with Unsplash License