Quote:
Originally Posted by Dadhawk
With a car, it only matters if you want to borrow the money to buy the car. That has nothing to do with buying the car, that's taking out a loan. The dealership will happily sell you the car without the loan (but I get your point). A person could say the same about that new TV she can't really afford, or the $4000 suit he thinks he has to have, its just so ingrained into the American car buying process that you have to have a loan, most people never consider just buying what they can afford.
It makes it a little more difficult to rent an apartment sure, and it could possibly increase your cost of insurance, but it's marginal. In the case of an apartment it might require a bigger deposit. With insurance, you may have to shop around more.
Your advice, if you care about having a credit rating, is solid, no argument there, its just not mandatory.
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Depending on where you're trying to rent, not having a credit rating (let alone a bad one...) could absolutely mean the difference between getting in or not. But the reason it's such a big deal with cars is that, next to buying a house or sending a kid to college (both done through obtaining loans, btw...lol), buying a new car is just about the largest single purchase a person will make. And not many people have $30+K sitting around as liquid. Sure, you can skip the bank loan and ask the dealership for a loan, but with no credit or bad credit, you're a huge risk, so you'll be paying ridiculous interest rates, whereas a loan through a bank or dealership with excellent credit and associated low rate can actually be a smart move. There's always low single digit financing programs available through manufacturers or banks...you won't pay much in interest, and your credit goes up in the process. They key is to not spread it out across a long term.
I have a good friend who is now in his mid 60s who, for the first 50 years of his life, never even had a checking account. His paycheck went in the bank, and he payed his bills in person, in cash. Never had any debt. But even he had to give up on that lifestyle. Try doing that today....it's a total pain in the ass, at best. Lots of utilities and government agencies like RMV
won't even accept cash payments in person any more..!! How's that for some irony...the government won't accept it's own currency...