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Cars and Credit Reports
The Problem
I was driving home from the store the other night when I noticed a license plate that made me laugh to myself and then I proceeded to feel sorry for the poor sap driving. The plate read “0 DOWN”. It was a white, shiny, new Ford Explorer (probably an 06′). Here’s what really got me about the caption: Not only did this consumer purchase a brand new vehicle with no money down, but he was proud of it. DUMB! Commercial advertisements and society as a whole embeds the “Buy Now, Pay Later” method into our heads and it works so well that around 90% of all consumers who purchase new cars do not put $5 down on the vehicle before signing the papers. The sad fact is, is that the average new automobile loses $3,000 as soon as it leaves the lot. Technically, you have gone into debt for something that loses value before you even use it. As if this wasn’t depressing enough, the less money you put down on a car and the worse off your credit is, the more you pay for the car. If this isn’t one big sand trap I don’t know what is!
The Role of Your Credit Report
Your online credit report is affected 2 ways when you buy a new car with no money down. First let’s look at the role it plays after you decide you NEED that shiny new sports car. The mass majority of consumers are thinking of one thing when they sit in the ‘sales chair’ to go through the paperwork: driving the car home (man this is bringing back some bad, bad memories). In order to do this you will need to finance the vehicle which requires pulling up your credit history and your credit report. This can easily be done online right in the sales office while you look around to make sure no one else tries to sneak off with your new toy. The worse off your credit report is, the higher interest rate you will pay. (This is fine though as long as you can still afford to buy food every other week and pay a few bills here and there.) The other role that your credit report plays in this game is the after-effect. The average new car buyer’s car payment is 25-30% of their total income. This creates a nice, big road block on your credit report in itself for when you are ready to make another large purchase. Not to mention when you fall behind on even one payment and your credit file takes a hard blow. Try to keep these factors in mind next time the kid in you tries to make a financial decision.
The Solution
Well you’re not going to like the best solution but here it is anyway: PAY FOR THE CAR IN FULL! If you saved the car payment every month in a good money market account; not only would you save time and money, but when you walked into the sales office with piles of hundred dollar bills you would get quite a deal! Okay, so you’re more likely to win the super lotto than do that right? Well here are a few ideas. As long as you practice a few you might get ahead of this nasty game a little bit or at least protect your online credit report. First, consider getting a 2 or 3 year old car. You can still get a shiny one and the previous owner will have taken the major depreciation of the vehicle passing the savings directly to you. Second, if you can, try waiting and searching to find the best deal possible. Trust me, there is more than 1 of those cars in the market. Third, put something down. Anything! For starters you could put down 10 to 15%. This will lower your monthly payment, lower your interest rate and maybe even cut your payoff time down. Lastly, get a bargain. Don’t settle for the asking price by any means. Be patient and keep control of your focus. One definition of maturity is learning to delay pleasure.
Understanding The Benefits And Weak Spots Of Credit Rating Assessments To Receive A Home Loan (Page 1 of 2)
Cleaning your undesirable credit after you have suffered in the course of a critical situation such as a inability to pay debts, foreclosure or a string of unfortunate financial events is essential if you are going to progress with your life. There is a lot to understand regarding cleaning your credit and elevating your credit scores. Dont be bothered; it is not complex with the suggestions made available to you in this piece of writing.
Starting with the do-it-yourself method requires that you comprehend all the principles to problem credit repair in addition to examining the information at present in your tainted credit history and initiating the required forms and letters to rectify any imperfections. The three central credit public agencies, Equifax, Experian and Trans Union are the controlling credit bureaus for information in the in the world of credit repair.
You should know you have a right to send away for your credit history report for free every 12 consecutive months. The credit public monitoring bureaus used to charge people a fee for the initial credit record until a new law announced by the Federal Trade Commission took came into existence. Everyone ought to pull their credit report annually and examine it for errors.
Each person is by the way entitled to order a copy of your report if you currently are not at work and looking for a job throughout the following three months, have been turned down for a arm loan as an illustration for any cause or if your are being paid some form of community help from the federal government. Most credit corporations will not tell you this for apparent reasons.
One of the primary areas to seek for credit repair help is online. There are a lot of financial websites that often publish detailed information on how to get going restoring your credit scores. Just do a search in your choice search engine for “credit history repair”. In addition to uncovering some broad resources on resolving your credit, you will come across the most effective credit repair associations in the industry.
The Federal Trade Commission website additionally provides comprehensive facts on fixing your credit files. More so, you will uncover samples of forms and correspondence for rebutting problems, fixing inaccuracies, eliminating old information and disputing data that is obviously not up to par.
The Municipal Library is also a terrific resource of help. Simply ask the Librarian for resource guides for the credit industry and tell them what you are seeking for. Most should be able to guide you in the right course. Local libraries are also vast sources for references and how-to guides published by seasoned professionals relating to bad credit restoration.
A good number of books published on the subject of credit repair will claim to be exhaustive. Keep in mind, there are no lone book that can amount to all the information regarding this diverse and sometimes puzzling business. The fundamental is to get resource materials that strongly agree with the individual circumstances in which you are confronted with and exercise that information as a resource to help guide you.