Do I need a credit card if I plan on buying a used car?

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I’m 22, graduated from college, live with my parents, never had a credit card, just got a great job, am still paying off a couple student loans, and is beginning to think about getting a car. Currently, I am sharing a car with my mom (owned by my dad).

Do I really need to get a credit card to show the car lenders that I am trustworthy? Aren’t there other forms of building a credit score?

  1. Reply
    February 26, 2013 at 6:18 am

    You should go to the bank you bank at an talk with them about qualifying you for a car loan. See what they will loan you. You may not have a credit history at this time because you have not had a credit card. This would probably cause you to have a higher interest rate. If your mother or father will co-sign your loan you probably will not have a problem getting a loan or a decent interest rate, as long as their credit rating is good. Be careful to not overload yourself with bills. I’d look at used cars.

  2. Reply
    February 26, 2013 at 6:54 am

    Yes. Put enough money in your savings account to match what you want to pay then tell the dealer that you have cash but would rather get a lone. A nice savings account is so much better than credit cards. if they turn you down you can just buy the car in cash.

  3. Reply
    Dan B
    February 26, 2013 at 7:09 am

    No one NEEDS a credit card to build credit. CC issuers have been running this scam for years and years. A savings account is a better indication of your ability to manage your finances than a bunch of credit cards. With a credit card, you are BUYING a credit profile through high interest rates and annual fees. With a savings account, you are EARNING a credit profile. But they do not care about your ability to save money. They care about your willingness to spend money. They want their card holders to get into as much debt as possible so they can make as much money (interest and fees) as possible for the CEO and stockholders. They could not care less about their customer’s financial burdens or how the CC issuer got them into that situation. The important thing is that it takes individual responsibility to keep that from happening.

    CC issuers know human nature. Humans are impatient, forgetful, egotistical status seeking animals, greedy, and not very smart at financial matters. Humans cannot wait to buy something that will make them feel good or look good, regardless of the cost. They will forget to make the payment, incurring a late payment fee and interest charges. They cannot remember how much credit they have left and will overspend, incurring an over limit fee. They will spend more than they can afford, incurring interest charges on their credit balances. The FDIC noted in 2008 that 93% of the $ 18 billion bank ATM overdraft fees were paid by 14% of their customers. NSF checks added $ 12 billion dollars to that figure.

  4. Reply
    February 26, 2013 at 7:14 am

    Paying off student loans shows you are trustworthy and builds your credit score.

    You do not need to show lenders anything to buy a used car. You only need lenders if you are going to finance a used car. You can buy a used car without a lender simply by saving enough money to pay for it.

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