WORDS BY LADY G- SPEAK UP:BUILDING CREDIT/CAR SHOPPING ADVICE FOR YOUNG ADULTS

Speaking Up

          Today, let us talk about: BUILDING CREDIT/CAR SHOPPING ADVICE FOR YOUNG ADULTS

1.   First things first: You have to build your credit. In America, your credit is your freedom, if you will, in the material world.

A.   There are three credit bureaus: Experian, Transunion, and Equifax.

B.   Before you take any steps to start building your credit; make sure you are absolutely ready. It takes a bit of time to build your credit, but no time at all to ruin it.

C.   To build your credit: go to your local bank (Research. Banks that are located all over the country are best to go with) and request to apply for a “secured” credit card. A secured credit card is similar to a debit bank card, except a secured credit card counts towards your credit score/report.

D.   The logistics of a secured credit card: if approved, you would provide a dollar amount ($300 is good to start off with). The idea is to not use more than 30% of the amount you put towards your secured credit card. Example: On a $300 secured credit card, you would use $50 (max) a month.  

E.   Tips on how to maintain and keep up with your secured credit card: Make sure you get a receipt for every purchase. Record every transaction. Make sure you pay your bill on time.

F.   Other forms of building credit: Basically, anything you sign your name on is recorded on your credit report. Some things don’t count towards building your credit, but can ruin it if you are delinquent/overdraft on checking account and don’t pay it back, unpaid student loans, unpaid car loan, evictions (unpaid rent money), unpaid medical bills, etc.

G.  One crucial tip: The more your credit is ran (in a short period of time) to see if you will be approved for what you apply for; the lower your credit score will go. Make sure to research what you’re applying for, is really what you want to invest in (make your credit check worth it).

H.   You can sign up with www.creditkarma.com (not sponsored) for free, to keep tabs on your credit score/report. I’m sure there are other sites that are good as well (make sure to research, before signing up for any account). Make sure it is a secured site as well. Credit scores range from 300-850. You want to stay between 620 to 850.

2.   Car Shopping Time

A.   If you are able to save cash for the car you desire, by all means, go for it. You’ll save yourself the headache of a monthly car payment. Your credit wouldn’t have to be checked. It will not affect your credit in a good or bad way, because you wouldn’t be using your credit to get a car.

B.   If you must apply for a car loan, it would be best to apply through a bank rather than through the automotive dealership. The automotive dealerships run your credit, but go through multiple car financing/lender companies to get you approved for a car loan (Keep in mind, businesses look out for each other, not you! Even though you are the customer). Their goal is to get you approved, no matter the cost.

3.   Facts to HAVE/RESEARCH prior going to a dealership:

·         CREDIT SCORE OF ATLEAST 650-719.

·         CACULATE THE MONTHLY PAYMENT YOU CAN AFFORD.

·         LOW INTEREST RATE/APR (ANNUAL PERCENTAGE RATE).

·         HAVE A DOWN PAYMENT OF ATLEAST $2,000.

·         LOAN TERM-LENGTH OF A CAR LOAN.

·         PREPAYMENT PENALTY.

·         ADDITIONAL FINANCE CHARGES-LENDERS MAY CHARGE FOR ORGINATING A LOAN.

·         NEW CAR LOAN VS. USED CAR LOAN.

·         DEBT-TO- INCOME RATIO.

·         WARRANTIES.

·         FUEL EFFICIENT CARS.

·         CAR FAX REPORT ON THE CAR YOU ARE TRYING TO BUY/LEASE.

**KEEP IN MIND THERE’S ALSO INSURANCE THAT YOU HAVE TO PAY ON THE VEHICLE EACH MONTH. FOREIGN CARS ARE THE BEST, BUT REPAIR COSTS ARE VERY EXPENSIVE. TAKE A KNOWLEDGEABLE PERSON WITH YOU.

** I REALLY HOPE THIS HELPS MY LUVAHOLICS. FEEL FREE TO EMAIL ME: GHADIR@WORDSBYLADYG.COM IF YOU HAVE ANY MORE TIPS THAT CAN CONTRIBUTE TO THIS SPEAK UP, PLEASE FEEL FREE TO SHARE (I WILL DEFINITELY GIVE YOU CREDIT FOR IT).

**MAY YOU ALL HAVE A BLESSED DAY. I LOVE EVERY ONE OF YOU!