It’s a rainy day outside of , and with a light sprinkling of clients on the inside, it seems to show a trend concerning teen buyers.
“We used to do birthdays, 16th birthday presents, and Christmas presents, and that hasn’t happened in the past couple years,” said Christie Parker, Sales Manager at Dean Sellers Ford and Seaholm alum, who has noticed some changes.
Recently, many teens have had to find a way to purchase their own cars through jobs or other means, unless there are certain circumstances.
“The only kids that I know that can get cars are their parents both work full time and they have younger siblings at home,” said Parker, “and that is a benefit perk that that older one gets.”
Kate Becker, a junior, who has just gotten her license, is interested in getting a car. During the summer, she travels back and forth from Madison Heights almost every day to do community service, and she may also have to drive her younger sister once and a while, which she thinks might be another incentive, since as of now her mom is undecided about getting another car.
“She has to think about it,” said Becker of her mom’s opinion.
With a full-time job, she could probably chip in with monthly payments, “but without a job, that just wouldn’t happen,” said Becker.
This seems to be another problem for prospective teen buyers.
“You’re not going to be able to get a car unless you get a real job and an income,” said Parker.
Even if a teen can afford to pay for a new car on their own, and is ready to purchase, there still are a few stipulations.
“They have to be over 18. That is the law,” said Parker.
After that, another issue could be getting a loan.
“With the credit issues right now, they’re not going to get a loan… on their own. Before, probably if you didn’t have any credit history, you couldn’t get a loan anyways, but you could co-sign,” said Parker, “But you’re not going to get a loan, not unless you’re in college. Since you don’t have a credit score, the banks are just going to be like “no way.”’
If a teen considers co-signing with a parent who has a more established credit-score, they could run into other problems.
“Co-buyers can be someone’s spouse or something like that,” said Parker, “but it can’t be to boost someone’s credit.”
But there are some solutions.
“If you turned 18 I might recommend that you be put in the car loan with them so you can build some credit,” said Parker, which could help build credit for future big-ticket items like cars.
Some advice on what teens can do who are trying to save up for big purchases, like cars, has to do with how money is spent and how it is organized.
At least one banker in the Birmingham area suggests that teens have a separate account for money that they’re saving and a separate account for money that they’re spending. She also suggests that finances are kept separate.
Simply opening a savings account could be one way to save money, or could at least help to keep track of what is being spent.
Teens under 18 need just 25 dollars to open an account at Bank of America, and the interest rate on savings accounts is .2%.
But the surest solution for saving up for a car is also the hardest to follow. Don’t spend.
