So your son wants to buy a car. . .

by: Michelle Singletary

During my online chats with readers, I often run out of time trying to answer all of the questions.

Recently there was an inquiry I wanted to take some time to address. It was about a young person’s first car purchase, something that comes up in almost every family.

Here’s the background: A 23-year-old has $3,000 saved and has chosen a used 2014 vehicle that costs $17,000 (no model specified). On his own, he qualifies for a $15,000 loan with a 9.9 percent annual percentage rate. With a parent co-signing, he qualifies for $18,000 with a 2.8 percent APR. His mother wrote, “I am willing to co-sign, as well as his dad, to get the better rate.”

He currently drives his mother’s 2000 car (no model specified).

continue reading »