Consumer Watch: Late payment on car loans are increasing

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    Data from the New Your Federal Reserve Bank shows a sharp increase in the number of auto loans that are delinquent for people 30 and younger, and an uptick for people who are over thirty too. These seriously late payments create a domino effect of serious financial problems for people.

    The data does show some somewhat positive news, as the rate of loans that are late by 90 days or more is still lower than peak 2010 rates, but an increase in these numbers right now means that not everyone may be benefiting from the strong job market.

    In most of the U. S., cars are essential whether it’s for getting to work, going to pick up the kids at school, or even a trip to the grocery store. However, cars are expensive, especially a new car with all the bells and whistles. There is also a habit some might have to get what they want, over what they need without knowing where their finances stand now.

    “It is so important to know what is reflected on those bureaus and to understand how that information affects your livelihood and your ability to access credit,” says Rose Washington with the Tulsa Economic Development Corporation.

    So, be familiar with your credit report and credit score before shopping around, and if you are approved for a car loan, it's important to know what you are signing.

    “When we are making a purchase of that magnitude, we really need to take time to read and usually no one makes an impulse buy of a vehicle,” says Washington.

    People with low credit scores or bad marks on their credit report often only qualify for a subprime loan, and that usually means paying enormous interest rates.

    We've got your back with ways to keep from biting off more than you can chew when it comes to getting a new car.

    -Significant down payment.

    • The less you need to finance the less you'll pay in interest

    -Consider waiting.

    • If all you can get approved for is a subprime loan, think about waiting until your credit is better before getting a car.

    -Get what you need.

    • Don't get starry eyed over a fancy car, instead pick your budget before you start shopping, and only focus on cars you can afford.

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