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"Is it a good idea to build my credit by getting a car loan at 20 years old? "
"I am 20 years old and have a stable, good paying job. I also have decent credit, but I would like to build up my credit for when I eventually want to buy a house. Is a car loan a good idea?"
Johnny Puckett · Updated on
Reviewed by Shannon Martin, Licensed Insurance Agent.
“You should never
buy a car
specifically to build credit. There are plenty of ways to do that for free.However, if you need a car and can afford it, it’s not a bad idea. You should be mindful of the interest rate, though, and you should shop around for the best deal. Dealership financing can be easier to get approved for, but credit unions will typically have the best rates.
Another bonus of getting a loan from a credit union or bank is that it will give you an opportunity to build a relationship with a lender that could help you get a house in the future.”
View full answer
- Gregory R.
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