Car Loan Experience
The Slides should guide you through the process of helping the students to buy their first car. The main goal of financing a car is to lower the rate on their first home mortgage (Installment credit = 3 years). My suggestion is that they look for a $10,000 after saving $5,000. Try to secure the loan based on the collateral and capital of the loan (without a cosigner) and without an early payoff penalty. If the rate is 8% or higher (its only on $5,000 so the interest isn’t too bad) they could refinance the car loan into a lower rate after making on years’ worth of on-time payments (read: Poor Car). Also, car loans should not exceed 3 years. The car will already be two years old (never buy new) so a three-year loan means you are still making payments on a five-year-old car.
Also, many suggest looking at insurance first, and this is good advice.
- Budget Question Day 4
It’s the 24th of the Month
- Teacher: Bank Account = $456.05
- Auto Technician: Bank Account = $487.04
- Associate Professor: Bank Account = $1,030.45
- Lab Technician: Bank Account = $1,376.65
- Computer Programmer: Bank Account = $1,399.25
- Congratulations, you have a job interview! However, you need new clothes. Do you have $75 in your budget to buy some new clothes?