Will I Qualify?

[monkeywre]

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Until I was 21, my thinking was that I should always try to avoid taking on debt- no matter how small. If I didn't have the money upfront, I shouldn't buy it. So, I didn't get credit cards, or take any loans. However, after reading up, I realize that taking on debt but paying off on time is what really helps the credit history. Not taking any debt hurts the credit file. Please correct me if I am wrong!

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It is true that borrowing money helps build credit, but not borrowing money makes you richer in the long run. If you have the money to buy the items that you need you would be crazy to give the bank your extra money in the name of building credit especially on things that go down in value like cars, or credit cards. There are some good arguments that borrowing as much as you can on your house might be a good idea but many people have been wiped out this way so YMMV here. Seriously though don't take out more credit than you actually need it really will cost you and I know this forum is about borrowing but I can't help speaking my mind in this case.

[Anonymous]

I appreciate your reply- it certainly rings true. However, I have a good understanding of my financial position and I know how much I can afford of what. One reason why I want an auto loan is to improve my credit score, so that down the road when I am purchasing a house, I would be considered a safe borrower. I am fully aware of the "depriciation is for suckers" concept when it comes to purchasing a vehicle.

Regardless, my reason for starting the thread was to see if I would get qualified for a loan or not before I approached the lenders with my short credit history- and you all have been very helpful. I just filed a credit application, and I was approved for 0.9% financing for the requested amount for 36 months (vehicle manufacturer's financial services). I don't think I can get a better rate than this at my CU or other banks, so I might jump on this one.

Thanks for all your help!

[Creditaddict]

Congrats on the great rate and the fact that you are only taking out a 36 month loan, even Suzie Orman would approve that