Money Matters
bnnunley
member
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Our tech team has launched updates to The Nest today. As a result of these updates, members of the Nest Community will need to change their password in order to continue participating in the community. In addition, The Nest community member's avatars will be replaced with generic default avatars. If you wish to revert to your original avatar, you will need to re-upload it via The Nest.
If you have questions about this, please email help@theknot.com.
Thank you.
Note: This only affects The Nest's community members and will not affect members on The Bump or The Knot.
Buying a car
I'm in a substantial amount of debt, but will have I it all paid off by the end of this yearbto the beginning of next year. But it's all in collections. I was wondering if I get a car and make 1.5 times the payment per month (once I'm debt free) if that would build my credit? Thanks ahead of time for any feedback!
Re: Buying a car
1) If you are already in debt it is a bad idea to get in more debt. Adding a car loan will actually lower your credit initially because you will now have a higher Debt:income ratio. If you need a car you should find one that in super cheap and will be enough to last you 6-8 months until you are out of debt and then reevaluate what you want in a vehicle.
2) Since you are in collections your credit is probably not looking very good right now. It will likely be very hard for you to get a loan and if you do your interest rate will be crazy high. Would it help your credit? Yes. Would the extra amount you pay in interest be worth it? No. Is it a smart idea? No.
3) If you are looking to do something it improve your credit the best option is probably to get a secured credit card (sort of like a debit where you put $500 or so down on the card and charge from that). If you are able to be responsible with this card and pay it off each month the credit reporting agencies will post positive notes on your reports. Your credit will still suffer because the collections will stay on your credit report for several years but it is better than nothing. This will essentially do the same thing as getting a car loan but you will not be getting in to additional debt, paying a ton in interest, or lower your credit score with the hit that the loan will make.
So, long story short, don't do it. It is a bad idea.
WHY are you planning to buy a new car? Drive what you already have until it is no longer safe THEN buy a USED, economical vehicle. Once you have your debt paid off - SAVE for as large a downpayment as possible as well as for a 6 month's expenses in an emergency fund.
No offense but your advice SUCKS! My advice is better! My advice would be "Wing it and see what happens"
Haha! I wish I could live in a land where I thought like your advice! But then I'd probably be homeless
And that thinking is exactly why most Americans are in more debt than they can afford.
TTC since 1/13 DX:PCOS 5/13 (long, anovulatory cycles)
Clomid 50mg 9/13 = BFP! EDD 6/7/14 M/C 5w6d Found 11/4/13
1/14 PCOS / Gluten Free Diet to hopefully regulate my system.
Chemical Pregnancy 03/14
Surprise BFP 6/14, Beta #1: 126 Beta #2: 340 Stick baby, stick! EDD 2/17/15
Riley Elaine born 2/16/15
TTC 2.0 6/15
Chemical Pregnancy 9/15
Chemical Pregnancy 6/16
BFP 9/16 EDD 6/3/17
Beta #1: 145 Beta #2: 376 Beta #3: 2,225 Beta #4: 4,548
www.5yearstonever.blogspot.com
Exactly! I wouldn't get another car until you have all your other debt paid off first.
Exactly PP. Dear LoveisOnlySleeping, we try to be supportive and HELPFUL with each other on this forum, giving out good advice. Wing it is not helpful for somebody who is trying to get out of debt and improve their credit score- that is probably what has gotten them in this situation. Quit trolling and go away.
If that's the case, then I would save up $2-3,000 after you pay off the debt and purchase an older used vehicle. Use cash! If you take out a car loan right after being "debt free" then you are no longer actually debt free and have just put yourself right back into the cycle. Pay cash for your car, and sign up for a secured credit card to help build some credit.
TTC since 1/13 DX:PCOS 5/13 (long, anovulatory cycles)
Clomid 50mg 9/13 = BFP! EDD 6/7/14 M/C 5w6d Found 11/4/13
1/14 PCOS / Gluten Free Diet to hopefully regulate my system.
Chemical Pregnancy 03/14
Surprise BFP 6/14, Beta #1: 126 Beta #2: 340 Stick baby, stick! EDD 2/17/15
Riley Elaine born 2/16/15
TTC 2.0 6/15
Chemical Pregnancy 9/15
Chemical Pregnancy 6/16
BFP 9/16 EDD 6/3/17
Beta #1: 145 Beta #2: 376 Beta #3: 2,225 Beta #4: 4,548
www.5yearstonever.blogspot.com
I agree with this advice. If you have questions about what car to buy or what year, you can consider subscribing to Consumer Reports...it's a great place to get unbiased data about vehicle track-records. Also, many public libraries subscribe to CR and you may be able to find the info you need at your local branch...FOR FREE!