Financing A Car With Student Loans

Students often have a hard time landing a car loan, especially from traditional lenders like banks or other financial institutions. If this has been your experience so far, we can help you at North Coast Auto Mall of Cleveland. Whether you’ve struggled to get a loan due to your lack of credit history or unpredictable income, we can assist you to finalize a deal so you can get behind the wheel of your next car. We’ve helped hundreds of students find loan approval without the stringent requirements of traditional lenders like banks. To discuss your goals and financing options with a professional, contact our team online or by phone today. We’ll be happy to help answer your questions and find your approval for a car you love.

Why Students May Find it Difficult to Get a Car Loan

Unfortunately, there are many reasons why traditional auto lenders make it difficult for students to borrow money to buy a car. The first is that traditional lenders typically want to see that you have a good credit score, which requires you to have a long and diverse credit history. For many students, that isn’t the case.

Another obstacle is that lenders usually like to see that you have a steady source of income. While many students work while going to college, the income you earn is typically irregular and less than what you’d make as a graduate.

In addition, some auto loan lenders may turn you down if they see that you’ve already got a student loan. This is because they may determine that the amount of money you’ve borrowed or the amount of debt you already have is too high to allow you to repay the auto loan reliably.

Despite these concerns, students with loans can still get approved for car financing at North Coast Auto Mall of Cleveland. We’ve helped hundreds of students and drivers with no credit find loan approval and a car they love. If you want to improve your chances of loan approval, or improve your credit score for the sake of a lower monthly payment, you have options.

How Can You Improve Your Chances of Getting a Loan?

You can take several steps to improve your chances of securing an auto loan. One reliable path is to build up your credit score, whether by making regular payments on your existing credit cards or taking out a secured credit card. Secured credit cards are specifically designed for people who don’t have a credit score but want to build credit. They typically work by requiring you to make a deposit equivalent to the spending limit on your card.

If it’s possible for you to work while at college, this may also open up more possibilities when you’re applying for a loan. Auto lenders will treat a regular income positively because it shows you have the ability to make repayments.

You could also try saving up a large down payment or applying the value of a trade-in. If you can offer to pay a significant portion of the vehicle’s cost up front, this may encourage a lender to offer you a loan for the remaining balance.

Finally, you could consider asking a relative or friend to be a co-signer for your loan. Co-signers assume responsibility for loan repayments if you’re not able to make them. However, the co-signer’s credit score can also be affected if you fail to make your payments. That’s why it’s important to have a serious talk with anyone you plan on asking to be a co-signer so that they’re fully aware of its benefits and drawbacks.

Take Advantage of Buy Here Pay Here & In-House Financing

Here at North Coast Auto Mall, we want to offer you an alternative auto financing experience. Our in-house financing team doesn’t have to wait for loan application approvals from banks, because we offer our own loans. This means we can set the loan terms in consultation with you.

Our expert auto financing team has considerable experience in creating buy here pay here loans to fit the requirements of our diverse range of customers. If you’re a student with a limited credit history, we can work with you to secure an auto loan. Once your loan has been finalized, you can choose from our inventory of carefully inspected and maintained pre-owned vehicles from many top brands.

Why Should You Avoid Buying a Car With Your Student Loan?

If you’ve already tried several traditional sources of auto lending without success, you may be considering the idea of using your student loan to buy a car. This is a bad idea for several reasons. Firstly, student loans are typically repaid over 10 years and sometimes longer. This is much longer than a typical auto loan, including the loans we offer here at North Coast Auto Mall. As a result, you’ll end up paying more interest on your auto purchase if you use your student loan than you would if you secure a buy here pay here auto loan.

Another reason to avoid using your student loan is that the interest rate on it may be higher than what you can get for an auto loan. Even if the interest rates turn out to about the same, you’ll still save money in the long run because the auto loan will have a shorter repayment term.

Secure an Auto Loan With No Credit at North Coast Auto Mall in Cleveland

We hope that our guide to securing an auto loan as a student has shown you that you can still get auto financing while you’re in college. Don’t be put off by the credit score requirements and other barriers put in your way by financial institutions offering auto loans. Instead, talk to one of our friendly finance experts here at North Coast Auto Mall to get the approval process started. If you want to get an idea of what your auto financing could help you purchase, take a look at our extensive online inventory. Once you’re ready to make a purchase, you can either contact us or visit us in person at our Cleveland location.

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