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Silent-Speech-232 t1_jeeqph0 wrote

Reply to comment by iamaweirdguy in Is a $500 car payment too much by [deleted]

I don’t have great credit as I’m 20yr old. I did take a 7k loan on a car 2 years ago to start building credit. It has gave me a total of 15 points. Never had a late payment always on time. I called my credit union and the lady said something about because the loan was to small to make a large difference in credit so she recommended a larger loan. I was offered 9% on a 36 month term which would be roughly 630 a month. My bills are low. Because I’m in a poverty ridden area so living is fairly cheap.

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iamaweirdguy t1_jeer4va wrote

$800 a month is extremely low. Can you give a quick breakdown of those expense amounts (rent, utilities, insurance, etc)

Is your credit score like in the 500-600s? Take out a credit card and start using it and paying it.

The 13% interest is killer. You’d be paying a lot extra by the end of the loan. Is it possible to look for a cheaper car or use a large down payment?

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Silent-Speech-232 t1_jeet0ey wrote

My credit is 688 because I do have a credit card keep it under 20% usage and always pay it off. I also had tool payments from being a mechanic which helped. My current car I got a 14%. I don’t have any expenses in utilities besides electric due to having a well. Which is around 150$. I don’t have a car payment anymore due to double payments but that was 480$ a month in double payments. My rent is 200 due to my mother living with me and splitting the rent ( she is not moving out because she couldn’t afford it ). Car insurance is 200$. Phone is 40$. Credit card is whatever I spend on it. 75$ on internet then just small things.

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iamaweirdguy t1_jeevfhf wrote

With a 688 credit score you surely should be able to get a better rate than 13%.

How about putting a large down payment? Or looking for a cheaper car?

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Puzzleheaded-Fun9481 t1_jef2l02 wrote

Do you need a car now? If not, given that you bought one a couple of years ago, I would keep the car you are driving and pay cash for something when you get to that point, and/or wait for interest rates to go down. There are other ways to build credit. You could get another credit card and pay it off every month. But if I were you, I would focus on building my savings and that includes saving for a car.

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Ok-Sea6980 t1_jeerpw5 wrote

Get a secured credit card at a credit union to build your credit. Having a car payment is a ball and chain after you get over the glamor phase of having a new car

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