How To Pay For A Car In College

Updated October 25, 2022

How To Pay For A Car In College is an advertising-supported site. Featured or trusted partner programs and all school search, finder, or match results are for schools that compensate us. This compensation does not influence our school rankings, resource guides, or other editorially-independent information published on this site.

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While most college students want a car on campus, bringing a car to school can be costly. The freedom to go where you want, when you want, while away for school, comes with a high price. Costs go beyond just the price of the car itself.

Owning a car comes with many costs, and bringing it to campus may only increase them. Routine maintenance, tire replacements, and other typical car expenses make car ownership difficult to fit into a college budget.

That said, owning a car in college is not impossible. Degree-seekers often manage it, but do the calculations to make sure you can keep up with the costs first. The expenses include the price of the car and fees for parking near class via permits, meters, or tickets.

In this article, we outline venues offering affordable cars for students or student auto loans. We also cover financing a car, alternatives to purchasing a vehicle, and the hidden costs of bringing a car to campus.

Heads up Questions on the Cost of Cars

Do most students have cars on campus?

Yes; many students bring a car to campus. Often, learners need or want a car on campus to get to and from jobs or to drive home. However, many schools bar on-campus freshmen from bringing cars. Freshman need to research their schools' specific rules.

Is it worth it to own a car in college?

If someone needs a car for medical appointments, internships, or a job, they may find it worthwhile. The benefits might outweigh the cost of repairs, gas, maintenance, and parking. If a student wants, but does not need a car, a vehicle could easily become expensive.

Can a college student get a car loan without a job?

Yes, but not easily. Lenders hesitate to lend to degree-seekers without full-time jobs. However, they can opt for a buy-here-pay-here lot, which come with high interest rates. Alternatives could require a cosigner with good credit and high income who is willing to put their name on the car loan.

Payment Options

People pay for cars in many ways, but not all suit college students. That said, if degree-seekers need a car in college, they should not discount any of the options before researching them.

Payment options include:


Using cash requires paying the full purchase price upfront rather than financing the vehicle. When purchasing a car in college, learners may not have the income or credit score needed to finance the vehicle. That leaves one solid payment option: cash.

Paying for a vehicle in full requires dedication to save the money. An outright purchase means not worrying about monthly payments or defaulting on a loan. College students particularly benefit from removing auto payments from their monthly budget.


Leasing a car mirrors leasing an apartment. Lessees pay monthly to use the vehicle, but they do not purchase or assume ownership of the car. At the end of the lease term, lessees choose to return the vehicle or purchase it with cash or financing. Leases limit the number of miles drivers can put on the car. Failing to stay under the limit results in extra charges.

Leasing does come with advantages, though. Lessees get to drive a vehicle for a stretch of time before committing to purchasing it. Leases can cost less each month than auto loan payments. Lessees avoid paying loan interest, but pay other fees. These include a money factor, the unique type of financing charge that comes with leasing.


Those lacking enough cash to purchase a vehicle outright can buy it with a loan from a dealership, financing agency, bank, or credit union. Most car loans require at least some money down and then finance the remaining amount for 24-84 month terms.

Loans often constitute the most affordable way to pay for a new vehicle. Breaking the cost into affordable monthly payments makes it possible to fit car costs into a monthly budget. However, credit score and income affect loan terms. Individuals with low or nonexistent credit scores or no proof of income find it difficult to get a loan without a cosigner.

Some lenders occasionally offer student discounts. Before writing off loans because of high approval barriers, learners should check around for student auto loans discounts.

Where Students Can Look for Cheap Cars

Many venues offer cheap cars for students. The section below lists some common places for prospective buyers to start their car search.


Aside from new vehicles, dealerships often acquire older model trade-ins that they sell as well. Independent used car dealerships specialize in selling used vehicles or older model cars. Some offer in-house financing or buy-here-pay-here, but take care when considering those options. In-house financing can end up incurring high costs due to high interest rates charged on the loans.


Car buyers use places like Craigslist or Facebook Marketplace to find individual sellers looking to offload vehicles at affordable prices. People often find great car options this way. Using these venues avoids dealer markups when buying off of a lot. When buying from an individual seller, make sure to get the car inspected before closing the deal. Buyers should know exactly what type of car they will get before completing the sale.

Auto Sales Website

Websites like Cars for a Grand aggregate listings of affordable local cars for students. Other sites, like AutoTrader, allow searching by price and mileage. Degree-seekers might find local sellers looking to offload reliable used cars at low prices.


Auctions can be a gold mine when looking for cheap used cars. Auction types include government or police auctions, estate auctions, and impound lot auctions with seized property. Auctioneers sell vehicles as-is, meaning buyers will not really know much about them before purchase. Even so, auctions offer a great place to find an affordable vehicle for those who know what to look for.

Student Car Deals

Learners struggling to afford a car in college can look into the deals automakers and dealers offer. Both dealers and automakers offer special incentive programs to help college graduates entering the workforce. Current students may find these deals available to them as well.

Degree-seekers nearing graduation sometimes take advantage of these deals to save significantly on car purchases. Incentive program perks include cash discounts, rebates, or other discounts that make it possible to better afford a car. Programs often offer special financing, even for those without established credit scores.

Some of the manufacturers offering deals on cars for students include:


The Acura College Graduate Program offers about $500 off the purchase or lease of a new Acura model. Both recent graduates and current students qualify for the program. Buyers may also defer payments for 90 days when financing a new car under this program.


Audi offers recent and soon-to-be graduates special financing terms under the Audi College Graduate Program. This program allows qualifying learners to lower their interest rate, skip a co-signer requirement, or get lease security deposits waived. This program makes it possible to qualify for special financing terms even with minimal credit history. Audi offers the program on their new and pre-owned vehicles.


BMW's College Graduate Program allows students and recent college graduates to save $1,000 on a new or certified pre-owned BMW. Recent college graduates and applicants graduating within the next six months may meet the program participation requirements.

Chevrolet, Buick and GMC

The GM College Discount program offers college students and recent graduates discounts on eligible Chevrolet, Buick, and GMC vehicles. Qualifying applicants can combine the discount with other offers, including cash back or low-interest financing, saving even more on the purchase.

Chrysler, Dodge, Jeep, and Ram

Chrysler, Dodge, Jeep, and Ram do not maintain a national program, but local dealerships may offer cash discounts or special incentives for recent or soon-to-be graduates. These perks include special pricing, bonus cash, and rebates on certain vehicles. Talk to a local dealership for availability.

Ford and Lincoln

The FordDrivesU Program offers a $500 bonus cash incentive to recent graduates and current students. Purchasing and leasing both qualify for the incentive on eligible Ford or Lincoln vehicles from local dealers.


Honda Financial Services' College Grad program offers a $500 discount to students and recent graduates. This program offers other perks, too, including deferring the first payment for 90 days after vehicle purchase. This incentive applies to the purchase of any new Honda vehicles.


The Hyundai College Grad Program offers recent college grads and qualifying learners a $400 savings on a new Hyundai vehicle lease or purchase.


Mercedes-Benz Financial Services offers the Rising Star College Graduate Program to recent and soon-to-be graduates. This program allows qualifying applicants with little or no credit to finance or lease a new or certified pre-owned Mercedes-Benz. Domestic and international degree-seekers can apply.


The Mini College Grad Program offers a $500 discount to current and future graduates who opt to finance or lease a qualifying Mini. This program may also offer lower interest rates or waived security deposits when leasing a qualifying vehicle.


The Nissan College Grad Program offers current and soon-to-be college graduates up to $500 off the purchase of a new Nissan. Buyers can combine the promotional discount with other Nissan offers to save more money.

Nissan offers a bonus, too. Under the College Leaf Vehicle Purchase Program, attendees of participating schools could qualify to receive an additional $150 discount when purchasing a Nissan Leaf.


The Subaru College Graduate Program offers special financing or lease offers to recent and future college graduates. This program offers low interest rates to qualifying applicants with limited credit history. Subaru features other discounts, including 15% off parts and accessories to customize a new car.


The Toyota College Graduate Finance Program offers current and future graduates up to $500 when they finance or lease a new Toyota model. This program offers competitive interest rates and lease terms. Toyota may even waive a lease's required security deposit for qualifying applicants.


The VW College Grad Bonus gives college graduates and soon-to-be graduates a $500 discount when they lease or finance a new Volkswagen vehicle. Other perks include competitive interest rates and waived security deposits for qualifying applicants.

Other Ways College Students Might Obtain a Car

If buying a car remains beyond a student's budget or credit score, they can consider the following options.

Sharing With A Roommate or Sibling

Sharing a car with roommates or siblings cuts out-of-pocket expenses by splitting the costs with others. Disadvantages include lack of control over the vehicle, but most learners on or near campus only need a car occasionally.

Car-Share Programs on Campus

Large metro areas often feature car-share programs, offering cars for rent on a short-term basis. Because of their popularity, degree-seekers find these programs on college campuses more and more frequently. Several car-share programs work directly with colleges and universities to provide cars for students when they need them. Zipcar and Enterprise Rent-A-Car operate programs at schools nationwide.


Learners can opt to rent a car via traditional means when needed. Costs accrue daily, but renters avoid worrying about typical car costs, including maintenance, depreciation, insurance policies, and repairs.

Gift or Loan from Family

Degree-seekers needing a vehicle regularly might ask their family for a car as a gift or a loan. If lenders will not finance a student, a family member could cosign a loan or take it out in their name. Alternatively, family members who are able could buy a car outright and allow the learner to make payments to them. Asking family for assistance does not hurt if they could possibly help.

Costs to Consider Before Buying a Car in College

Parking On and Off Campus

When buying a car, individuals should factor in all of the costs, including both on- and off-campus parking. Students pay significant fees to park near dorms and class buildings. The parking lots near campus can easily cost a few hundred dollars per semester. Off-campus parking near the school may not cost much less.

College students in large metro areas with limited space or high-trafficked downtown areas often pay a lot of money for parking. Learners in rural areas with excess space around campus, may get lucky enough to park for free or cheap.

Location plays a large part in parking privilege costs. Review the school's permit policy and alternative options before bringing a car to campus. Students may face limited availability or permit waiting lists at schools with limited parking. Do some research before assuming access to affordable and safe parking on or near campus.

Car Insurance for College Students

Learners need to factor in vehicle insurance costs. College students do not always get the best insurance rates when on their own policies. Some degree-seekers choose to stay on their parents' policy while at college, cutting some of those costs. Clean driving records and safe habits will also help keep the costs down.

Some insurance companies offer discounts on car insurance for college students. These auto insurance student discounts include "good student" discounts based on GPA or class ranking and honors society or student association discounts.

Allstate offers the Smart Student Discount, specifically geared toward young drivers in school. Other companies offer similar discounts, so before choosing a policy, research different insurers and policies for the best deals.

Gas and Maintenance Costs

People with cars need an emergency fund for big repairs or other emergencies. All vehicles need repairs occasionally, and high-mileage used cars experience issues more often.

To calculate adequate savings, take a look at the average cost of car repairs. In 2019, car repairs averaged between $342.14-$414.24, according to CarMD. Repair costs vary greatly depending on parts and location, so individuals should save at least a few hundred dollars for surprise maintenance.

Car owners invest money in other auto essentials for safe driving, including jumper cables, spare tires, and weather-related gear. Most do not cost too much, but need to be included in a budget. The right tools on hand for any situation help cut down on repair or towing costs. Investing in these less-expensive auto essentials decreases maintenance and repair costs later on.

How to Choose If a Car Is Right for You

to own a car in college. If when evaluating their situation a learner finds a true need for a car, and they can afford it, they may want to consider it.

Attending a rural school far from home without access to an airport or other transportation can call for a car. Degree-seekers may need a car to get back home during holiday breaks. Working off campus could require transportation to and from work, justifying vehicle costs.

Individuals with chronic illnesses or health issues might need a car for doctors appointments or other important appointments off campus. Dealing with an issue like this without decent public transportation may demand car ownership. When it boils down to a true need, a student can justify a car while in college.

Alternatively, if a learner wants, but does not need a car, or if it will cost too much, they may want to rethink their plan. A car on campus can come with too much hindrance or cost, even if it occasionally comes in handy. People in areas with public transportation and limited parking might find car ownership too expensive to justify over taking the subway or other public transport.

Students should consider whether a car will interfere with the main goal of earning a degree. If heading off campus regularly causes too much distraction or other study issues, learners may want to rethink car ownership. Maintenance, parking, and other costs could also cause degree-seekers to reconsider, especially those with access to alternate means of transportation.

Portrait of Angelica Leicht

Angelica Leicht

Angelica Leicht has been a writer and editor for over a decade. Her work, which has spanned a wide range of topics including personal finance, lifestyle, and education, has appeared in publications such as The Simple Dollar, Bankrate, The Spruce, Houston Press, The Motley Fool, VeryWell, and others.

See articles by Angelica

Related articles that may interest you is an advertising-supported site. Featured or trusted partner programs and all school search, finder, or match results are for schools that compensate us. This compensation does not influence our school rankings, resource guides, or other editorially-independent information published on this site.

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