null How to Improve Your Credit: Establishing Credit History
Establishing credit as a first-time car buyer can be a doozy. Let’s
say you just graduated from school and are in the beginning stages of
adult life. You plan on purchasing a vehicle, but don’t have the
credit history you think you need to qualify for it. On the one hand,
buying a car helps you build credit. On the other hand, because you
have no credit history established, most traditional auto lenders will
consider you a higher risk, making it difficult for you to get
approved for financing. Whew, talk about a Catch-22! So how, exactly,
can you establish credit history with no credit? Let’s take a look at
Apply for Subprime Auto Financing
Although it may be difficult to get approved for financing through
traditional auto lenders, there are subprime auto finance programs
available to people with bad credit or no credit history established.
Credit Acceptance is an indirect subprime auto finance company that
works with car dealers across the U.S. to help credit-challenged car
buyers get approved for vehicle financing.
Once you’ve filled out the form
on our website and been connected with a car dealer enrolled in our
program, you can receive credit approval from that dealer for a new or
used car. And, if financing is provided by Credit Acceptance, since we
report to the three major credit bureaus you can build and improve
your credit with on-time car payments.
Get a Secured Credit Card
Since having little to no credit history can also limit your ability
to get approved for a regular credit card (again, because traditional
lenders may consider you a higher risk), getting a secured credit card
may be an option. A secured credit card requires a refundable deposit
that serves as the credit card’s limit. Just like you would with a
regular credit card, you can build a positive credit history with a
secured credit card by spending within your limits, keeping your
balance low and making on-time payments every month. However,
according to Experian, not all lenders report secured credit card
payments to the credit-reporting bureaus, so it may be wise to find
out which ones do prior to getting one.
Get a Co-signer
Having someone with a positive, established credit history co-sign on
your auto loan or financing is another way you can build credit as a
first-time car buyer. Co-signing on a loan is basically the same
concept as opening a joint credit card account with someone, in that
you are both responsible for the loan. Failing to make payments on
time puts your and the co-signer’s credit scores at risk, and the
co-signer can be held responsible for your late or missed payments.
The good thing about getting approved for auto financing through
Credit Acceptance is that you don’t need a co-signer to qualify for
approval. Simply fill out the form
on our website, get connected with a dealer enrolled in our program
and choose your vehicle! And, since we report to the three major
credit bureaus, you can improve your credit with on-time car payments.