Cars and Credit Reports (PDF) by hashournonos


Cars and Credit Reports

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The second largest purchase decision a consumer makes is what car they will drive. Unfortunately, this
usually leads to years of tight budgeting and even regret. This article will discuss how cars affect our credit
reports and what we can do to soften the financial blow.

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Article Body:
<b>The Problem</b><br>
 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 <i>proud</i> 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!<p>

<b>The Role of Your Credit Report</b><br>
 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.<p>

<b>The Solution</b><br>
 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 <i>something</i> 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.<p>

To read more about how you can get your online credit report free with no obligations, see what is on your
file and find out how to fix your credit report go to <a

credit disputes letters

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