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Tips On Buying Your First Car

Are you thinking of buying your first car near Dallas, TX? The first vehicle purchase is a milestone for many young adults. Here are a few things to keep in mind when buying your first car.

Set Up A Budget

Determine how much you can realistically afford to set aside monthly for your new vehicle. Add up your monthly expenses including rent, groceries, health insurance, auto insurance and vehicle maintenance repair costs.

Loan Amount

Paying for a vehicle in cash is ideal bunt unfortunately it’s not realistic for most individuals. Due to the total cost involved financing will be required for most buyers. The loan amount depends on the purchase price of the vehicle, your down payment and the duration of financing. Monthly payments will be lower if you finance over a 5-year period but you’ll have higher interest rates. Monthly payments will be higher if you choose to finance over a 3 or 4 year period but you’ll pay the vehicle off much sooner and pay less interest.

Financing Options

Financing options include a loan from relatives, finacing via your personal bank or credit union, auto dealership financing and buy here pay here dealerships. If you have an existing relationship with a bank or credit union you may consider applying there first since some lending institutions may be more lenient with existing customers. Auto dealerships can provide a large number of financing options due to their relationships with various lending institutions but tend to have stricter qualifications. If you have zero or bad credit and are having difficulty obtaining financing you may want to consider a buy here pay here dealership like Auto City Credit. Buy here pay here dealerships are generally more lenient because they offer in-house financing. As a result they have the flexibility to provide financing to customers who may not qualify at the dealership or bank.


If you have zero credit you may have to get a co-signer for your auto loan. This person will be legally obliged to take financial responsibility for the loan in case you default. Co-signers can be your parents, relatives or even friends.

Insurance Rates

Insurance rates can vary significantly depending on the make and model of the vehicle. Older family cars tend to have lower insurance rates while sports cars tend to be more expensive to insure. Rates are also dependant on the driver’s age, driving record and daily commute distance. Estimate your insurance rates before buying a car so you don’t end up with an unexpected high expense.

New Versus Used

Many first time buyers opt to purchase a used vehicle because it’s more affordable. New drivers are also more likely to get into minor fender benders which makes buying a cheap car more practical since it won’t be a huge financial loss if it’s totaled.
Contact us if you are interesting in buying your first car near Dallas, TX.