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Small loan for a car, yah or no?

D

duragezic

Lifer
I want to get a nicer car maybe like 6k I could then probably get a 94 Toyota or Honda. If I can get a nicer one like that I probably wouldn't have to worry about anything major going wrong and it'd last a long time.

But my parents are looking to spend more around 4k max. I could front 🙂 about $850 cash. Although that'd empty out my bank account, I don't need anything to pay for except my Act Labs FF steering wheel + skateboard but my next paycheck will take care of that.

So I could maybe get $5k at the very max. I was thinking about a 1k to 1.5k loan. Although I'm sure my parents are definitely against it, it would be nice so I could get a more pimp car. I make about $320 a month and although I'd need gas and food money, I could still make decent sized payment. Think this would be a good idea? I would get it under my name then have parents co-sign and that'd build up my credit a little right? If for some odd reason I couldn't make the payment one month my parents probably would (but again might take convicing to get the okay to get a loan).

I'd want to pay it back in like a year too so I get less interest. Any idea what's a general interest rate? This sound like a good idea? Thanks.
 
With zero finance rates you would be crazy to buy used! I'd bet for less money you could buy a new KIA or Hundai complete with 100,000 mile warranty for less than a used car. Zero upkeep and take it from me, upkeep on ANY used car will be more than the payments on a new car....better fule milage will probably offset the increase in insurance premiums.

6K? For 8K you can buy new...
 
Well 8k is definitely too much. They are completely against Korean cars too even if it was a brand new one so I couldn't do that.
 
eagle - I'm sure that you really try, you could budget yourself to save another $1,000 within a few months. If you still insist on getting a $1,000 - $1,500 loan then there's a few things you'll need to know:

1) Don't apply unless you're certain that you will be approved, are you 18 or over, do you have any credit, for how long, etc.
2) Can you afford $135 a month? If so, that will get you a loan of $1,500 for 1 year at a personal loan interest rate (remember this is NOT a car loan) of 14.5%

If you're wondering a few "what if" scenario's then use one of these financial calculators (scroll down to Simple Loan Calculator). It's very simple just input the loan amount, interest rate and number of years then it calculates your monthly payment. If say you can only afford $100 per month then scroll up to the What's Missing? Loan Calculator just leave the loan amount empty and it will calculate it for you. If you can only afford $100 a month payments then you can borrow an amount of $1,110.83 assuming an interest rate of 14.5% for 1 year.
 
Hp isn't a big concern but 100hp is low huh (sorry don't know anything about cars)? But even if there was some odd chance I found one and could afford it my parents wouldn't let me get it so I'd say that's outta the question completely.

I'm under 18 and no past credit history. Would I have a chance to get it?

That calculator is pretty nice. I could definitely afford $135/month. Could afford $200/month I'm sure but it'd depend on how much I wanted to put in bank account (after I completely deplete it on initial payment). I don't buy anything really except food (and try to hit the daily $.99 BK specials everyday) and when I would get a car then gas. I know I'd want to save some just in case for whatever but I really wouldn't need anything. I thought the interest rate was much lower though. I just guessed 8% but I was way off!

Thanks.

edit: I could save up 1k in 3-4 months but I don't want to wait that long. Sucks enough getting a ride 3 times a day from my parents. Thats just for work/school. Then if I want to do something with friends...

Er wait I have to help pay insurance now. That kinda hurts (well mom quit her job so I have to pay for a bunch of sh1t now, yippee).
 
Hp isn't a big concern but 100hp is low huh (sorry don't know anything about cars)? But even if there was some odd chance I found one and could afford it my parents wouldn't let me get it so I'd say that's outta the question completely.

Don't the early 90's Honda Civics and Toyota Corolla's have under 100 HP 4 bangers? If you want speed go for a Dodge Neon with DOHC, fun little car but the reliability and build quality are all classic Chrysler (in case you haven't gathered that's not a good thing). I'd go 100% Japanese if I were you unless you could find a good condition used Hyundai Elantra.

I'm under 18 and no past credit history. Would I have a chance to get it?

Nope. Don't even think about it unless you can get a co-signer like your parents, siblings, grandparents, friends, co-workers anyone who has established good credit and makes a decent amount of money.

That calculator is pretty nice. I could definitely afford $135/month. Could afford $200/month I'm sure but it'd depend on how much I wanted to put in bank account (after I completely deplete it on initial payment). I don't buy anything really except food (and try to hit the daily $.99 BK specials everyday) and when I would get a car then gas. I know I'd want to save some just in case for whatever but I really wouldn't need anything. I thought the interest rate was much lower though. I just guessed 8% but I was way off!

Yeah those financial calculators are awesome I recommend them whenever possible. If you're making $320 a month and can afford a $200 car payment I'd say that's a little steep, stick with $135. Don't forget about car insurance, gas, maintenance, food, and other unforseen expenses. If your car payment is only $135, at least you still have close to $200 per month to do whatever with.

8% is for a car loan. You can get that if you give the bank your car title but that's a big hassle and plus if the bank has a lien on your car you are required to carry FULL COVERAGE insurance, you can't get away with liability only. So even though the interest rate may be double, it's only $1-1.5k and only for 12 months, I think you can survive paying the extra interest.

I still say don't get a loan at all, just buckle up, brown bag it every day, do house chores and ask your mother to cook all your meals for you (LOL), this is turning into a CBS after school special but you know what I mean don't you? SAVE MONEY!
 
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