Your teen has little hands-on cash, but she has just started her new summer job and wants to build some credit. She wonders if an auto loan will help, and comes to you for assistance.

Building credit with an auto loan can help. Here’s how:

• Car refinance loans will enable your teen to purchase other things on credit in the future. With good management come greater opportunities such as the need for furniture, vacations, or a new motorcycle.
• Credit scores are built based on how timely and regularly payments are made. When your teen makes regular payments, his/her credit score is built.
• Your teen may already need a car to get to and from work. Getting that auto loan will help in both the commuting as well as the learning arena of your teen’s life.
• Don’t hesitate to get an auto loan with an interest rate that is higher than you expected. Interest rates are often higher for teens without credit. After a year, refinance the loan and get the interest rate you want.
• An auto loan will raise your teen’s credit score. If they pay more than the minimum payment their credit score will show it. Making double payments or a payment and a half per payment period is always helpful in improving a credit score.

When your teen builds credit, the success they feel will be on their own shoulders. Building credit is not only a good learning opportunity but a growing opportunity in building credit for future successes