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Ok, here is my situation. I start BASIC for the Air National Guard in August, and I won't be done with my tech school for about 8-9 months later. When I do get out I think I may have about 14k to spend on a car. I was thinking of getting either a year or two old Focus SE, or a new one if the rebates are still around.

Here is my problem....

I would have 14k cash to spend, but I would like help out my credit report. So how difficult would it be and how much more would it cost me to get a car loan and pay it off asap. And how long would I have to wait to pay it off?

Thanks for any and all help.
 

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Put a large chunk down to make your payments VERY VERY Small... like $50/month....

that will build history.

Except that it still shows that your balance was small to start with.... so it doesn't add too many points.

Credit ratings are soo damn tricky... it all has to do with income, debt to income ratio, payment history, potential debt (how large your revolving credit account balances could be)....

if you can afford it... save that money for a rainy day and just make payments on the car.... put $7K down and have some nice payments.... at low interest over a lengthy time.

Just my $0.02
 

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no bank will allow you to finance such a small amount of money for such a long term. $50/mo. isn't worth their time.

If your primary goal is to build credit, put down 30-50% on the car purchace. Finance the remainder. Make every payment on time, and make every payment for the duration of the loan. Buying a car and paying it off in 3 months isn't going to help you. You need to make a year or two of payments to really establish yourself. The only downside is that your paying interest each month. However, good credit is worth its weight in gold.

Credit history is just that...a history. You need to prove that you can make payments over the long-term. A good credit history is years in the making. Your score is based on a number of factors including the number of accounts you have, the age of the accounts, your payment history, debt to income ratio and the amount owed on accounts.

Having a larger payment each month can be beneficial. It will prove to the bank that your able to handle a more substantial payment in the long term. Paying $50/mo. on an account doesn't mean much, but paying $200/mo. is significant. It will help spring board you into your next car purchace.
 

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First things first. Building credit costs money.
Sounds like you just need self discipline here. Put 14K in the bank. Go buy a car that will add up to 14K. Price of the car + TTL + Financing charges over the life of the loan. Then write a check from that account every month for the life of the loan. Very simple, you just have to keep from spending the money in the account. If you know you can't do that and you'll just drain the account putting on a turbo so then you'll have a blown up car and an empty account, then you're better off just paying cash and building credit in other ways.
On another note, someone here who worked for Ford Credit said that if you buy a new car from them, make EVERY payment on time for the life of the loan, you'll be automatically approved for your next loan (within reason, no GT-40 for me) Something to think about as Ford Credit is supposed to be the largest private lending institution in the world. Be good to Ford and they will be good to you.
 
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