6 Top Auto Finance Companies for College Students

A dream of many college graduates is to own a new car, and they are able to finance this dream through auto finance companies that cater to recent college graduates. New college graduates find it hard to obtain financing because they usually do not have a track record of credit. On top of this, most new college graduates have low incomes, making it difficult for them to qualify for auto loans. Here are several finance companies that are willing to work with recent college graduates to put them in the car of their dreams.

Auto Manufacturers

Almost every car manufacturer has a financing program for recent college graduates. If there is a particular make and model of car that you want to buy, consider financing the purchase directly through the car manufacturer. Some manufacturers, such as Volkswagen and Ford, offer very low interest rates and cash back rebates for college graduates. Financing through the car manufacturer may be the best choice but only if you are interested in purchasing a model offered by the manufacturer.

Automotive.com

If you are unable to arrange financing directly from the manufacturer, there are quite a few online sites that provide favorable financing to college graduates. The biggest of these is automotive.com. This site is not a direct lender. Instead, it is a broker that will match an applicant to different financing companies based on that person’s income and credit status. This is a convenient place to shop for the best rates from among different financing companies.

Autotrader.com

Autotrader.com is the largest place on the Internet for selling new or used automobiles. The site also provides financing options. It operates similarly to automotive.com in that it is a broker. A potential applicant will input the requested information. The website will pull his or her credit report and then provide the applicant with up to 4 quotes from different financing companies. You get to choose the lender that best fits your needs based on their rates, monthly payments and down payments.

Bankrate.com

This website will not provide financing for purchase of a new or used car. Instead, it will list the interest rates and fees for car loans for up to 20 companies in your chosen city and state. This allows you to comparison shop based on rates. Once armed with this information, you can approach a bank to obtain financing.

Your Local Bank

If you currently have a banking relationship with a local bank, you may find it easier to qualify for an auto loan through them. Banks are more lenient on their loan requirements for current customers. Be sure to talk to your local bank to get their rates and fees for financing.

Credit Unions

Compared to most banks, credit unions typically have the lowest rates for auto loans. This holds true for financing the purchase of both new and used vehicles. The biggest hurdle in dealing with credit unions is to meet their requirements for memberships. Unlike banks, where virtually anyone can open an account, you can join a credit union only if you meet its membership requirements. Even if you meet the membership requirements, you will find that credit unions have strict criteria for loan qualifications. They will approve loans only to people with good credit and income.

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