Quote:
Originally Posted by FFMaro
I am 18, work at the fire dept as a FF/EMT making $29,000 a year, I have no credit history, I was just put on as a joint card user on one of my parents credit cards. The credit card company says this will help me to start building credit history. My question is that how long will it take me with this 1 credit card to build enough credit history/ credit score to be able to qualify for a $22,000 auto loan with an $8,000 down payment? Also, what kind of APR might the camaro be offered with? I have no expenses, so I plan to pay this car off as quickly as I can.
Thanks
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I was in your position a few years ago (i'm 26 now) and signed up for this site JUST to give you an opinion. I couldn't stand living at home and moved out ASAP. Driving a new car and taking ya girl back to your parents house isn't pimp. Besides that...let's talk financing and assume your parents will co-sign, otherwise you arent getting a loan. For comparison sake I make $68k with 720 FICO, 0 debt, and still get declined due to "insufficient credit history" and i've had multiple credit cards for 9 years but no car loans, i paid my parents monthly!
$22k loan including taxes minus 8k = 14k loan @ roughly $280 a month.
Dumping $8000 from your savings isn't the best idea in the world though. Right now is the perfect time to dump $5,000 into a ROTH IRA in a small cap growth fund. If you never add anything to that fund again, it will be $187,000 when you turn 65 (modest 8% return). If you add a modest 100 a month to it from here on out, it will mature to $752,000!!! That is a 3/4 a MILLION dollars investing only $100 a month.
When I was 16 i drove a 94 z28 (400hp) and at 18 I drove a 3000GT VR4 (400HP modded
) that about broke me every month and I don't regret it a bit. I loved cars and loved driving them so I'm not going to tell u not to buy but take into consideration a few options...
Buy the car, put $4000 down, start the roth IRA, have your parents co-sign for a sub 5% interest rate (penfed.org is 4.75) pay ~$375 a month. Get another credit card that's in both your parents names. When your FICO score goes above 650 ish, get yourself a card thats worth KEEPING (AMEX Skymiles imo). Now you have 3 cards and a loan. By the time u get out of college you'll have enough credit to buy a house and a paid off camaro!!
Have fun, enjoy the car and sit back knowing you will have money when you retire even if the state lays you off from the fire department...cause its happening now and economics are cyclic!
-James, the twisted chemical engineer