Do You Need to Establish Good Credit? Buy a Car!

June 9th, 2017 by

If you’ve shied away from borrowing money in the past, you may find a bunch of life tasks difficult. Buying a bus pass could be more hassle than necessary, pre-buying tickets to your favorite band may be impossible, and good luck applying for a mortgage. You need to establish good credit to make everyday life more convenient. A great way to do so is by purchasing a car!

How Does Buying a Car Establish Good Credit?

It’s a good question. There are some basics about car loans you need to know.

  • Currently, car manufacturers including Toyota are pushing to increase their sales. The economy supports low-interest rate loans and the cars are absolutely phenomenal right now (have you seen the Toyota C-HR?). A car loan may be one of the easier ways to start your credit rating, simply because manufacturers are so willing to help get you into one of their cars.
  • As well, a car loan is a substantial sum. If you can prove yourself to be responsible with a fairly large loan like a car loan, it goes a long way to establish good credit. By making your payments on time, every time, you can skip all the smaller methods of building credit that take years, like a credit card.
  • It provides reliable transportation. You know that job you go to every weekday? If you miss the bus to get there, or if your old, junky car breaks down, you’re not going to keep your job very long. By purchasing a new, reliable Toyota, you’ll be able to ensure there’s no excuse to be late or miss work. Keep those paychecks rolling in!
  • It establishes a routine. When you have a car loan, you get into the habit of paying your commitments first, then spending what’s left. When you purchase a car to establish credit, you’re helping yourself learn how to manage your money better.

 

Posted in Jay Wolfe