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How to Go About Financing Your First Car

You’ll gain more insight into managing your finances while buying a car for the first time. Prior to financing your car, you’ll need to acquire knowledge on transferring car loans or identifying the minimum eligibility criteria for reducing the burden of your parents. You’re bound to get excited when you achieve your first car loan. However, you’ll need to be concerned about certain expenses like that of the repair, maintenance and fuel charges before signing up for one. You may consider discussing all issues with a prospective lender and getting your doubts clarified in advance. It will certainly make things easier for you to buy your dream car.

Few important questions that you need to ask while applying for a car loan:

  1. How old do you need to be while applying for a car loan?

It often becomes easier for you to apply for a car loan or buy a car when you’re stepping into adulthood. Car financing and vehicle registration are processes that are governed by the respective state regulations. As per the DMV, some states enable you to drive a car when you’re at least 16 years of age. However, in most states, you’ll need to be at least 18 years old while applying for a car loan. You may curb your commuting and car financing challenges very effectively when you’re aware of your state laws.

  1. Is it possible to apply for a car loan before the age of eighteen?

The sooner a teen achieves the Learner’s Permit he’s bound to get overwhelmed by the idea of owning a new car. Arriving at any binding car loan contract isn’t possible till you attain 18 years of age. The laws governing car loans consider a 17-year-old teenager as a minor. While applying for your car loan, you’ll be able to find a co-signer only after you’re over 18 years of age. Remember that your credit history is of less value to a lender when you’ve just attained 18 years. You’ll require another financially stronger individual to stand by you as the cosigner. He’ll be sharing your risk in the event of your failure to repay the borrowed amount.

  1. How to transfer the current loan in your name once you turn 18?

Once you turn 18 years of age, you’ll be eligible to sign a valid loan contract, represent any untoward incident in the court, and exercise your voting right. You’ll end up proving yourself more responsible financially in the eyes of a lender when you’re 18 years of age, earning comfortably and capable of following a repayment plan diligently. However, you’ll need to meet your credit card dues simultaneously. Transferring the loan in your name helps your parents in managing their financial situation more effectively.

Final Words

Buying a new car reflects your financial independence and improves your lifestyle. However, you’ll need to bear certain responsibilities and abide by a few regulations while driving your new car. Drive your new car out of the showroom only after you turn 18 as you’ll then be eligible for a car loan.

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