What's the best way for a student to get a car loan?

I want to get a car, but I'm a college student, and I don't have a ton of money. Some other people on campus were talking about buying a car with student loan money. Can I do that? Or should I find a different way to buy a car?

While some students may use their student loans to pay for a car, this isn’t advisable.
When you use your student loans instead of a traditional car loan to get a vehicle, you’re going to run into a host of problems, namely using funds intended for your education to purchase a depreciable asset. Using your student loans to purchase car also has other drawbacks, including:
  • Your interest rate is usually higher than a car loan rate
  • You could end up paying for a car for 10 years or more
Instead of using your student loans to buy a car, consider a few of these alternatives:
  • Get a part-time job and save up money to buy a car
  • Buy a used car with your current savings
  • Use public transit
  • Consider a scooter, motorbike below 50 cc, or a bicycle
If you decide to purchase a vehicle with a car loan in the future, you’ll need full coverage car insurance. Make sure you compare car insurance quotes so you aren’t leaving money on the table. Use the Jerry app to compare quotes from dozens of insurers so you’re always getting the best possible rate and maximizing your savings.
Eric Schad
Answered on Nov 05, 2021
Eric Schad has been a freelance writer for nearly a decade, as well as an SEO specialist and editor for the past five years. Before getting behind the keyboard, he worked in the finance and music industries (the perfect combo). With a wide array of professional and personal experiences, he’s developed a knack for tone and branding across many different verticals. Away from the computer, Schad is a blues guitar shredder, crazed sports fan, and always down for a spontaneous trip anywhere around the globe.

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