Are you thinking about how you’re going to pay for your first car? You could get it:

• As a gift or hand-me-down within your family
• With cash you earned from your job
• With an interest-free loan from your parents

But what if none of these options is open to you? You could get a loan. Here’s how:

Step 1: Save for a down payment

It’s sometimes possible to finance 100% of a vehicle purchase. But why not save money in the long run by making a down payment?

When you make a down payment, you borrow less. This means your monthly payment decreases, along with the total amount you pay in interest charges on your loan.

Step 2: Find a co-signer

Usually, if you’re younger than 18, you will need to have a co-signer for the loan. Even if you’re 18 or older, you might need a co-signer, especially if you’re just starting out on your own and don’t have an established credit history. A co-signer is someone who agrees to pay back the loan if you don’t. Not just anyone will be willing to do this for you. Often, a parent or an older sibling will.

Step 3: Get the best loan

Put yourself in a strong position by:

• Doing your financing homework
• Arranging your loan financing at the credit union ahead of time

Arranging your financing in advance is like having the money in your pocket when you go car shopping. Dealers sit up and take notice. This gives you the upper hand when you start negotiating.

Step 4: Have a plan

Work out a plan for making the loan payment as well as the other car expenses such as insurance, gas, oil changes, and repairs.

Ask your friends or family members how much they pay to keep their cars running. Ask a lot of people so you can get a better idea of what your car will cost you.