Young Adults Navigate Economic Challenges, Auto Financing Options on Their Own

Capital One`s Rules Of The Road Survey Reveals Lack of Parental Guidance and
Credit Awareness in First Car-BuyingExperience

MCLEAN, Va.--(Business Wire)--
For many newgraduates, getting a diploma and getting a new car are rights of
passage that go hand in hand. However, according to the Sixth Annual Rules of
the Road Survey by Capital One Auto Finance, a subsidiary of Capital One
Financial Corporation (NYSE:COF), many young adults will be making the largest
purchase of their lives without parental advice and devoid of basic financial
information like their credit score.

As young adults prepare for this important first purchase, the Capital One Auto
Finance survey found that many young people are navigating the car-buying
process by themselves, with more than half of those surveyed (52 percent)
reporting that their parents have not discussed budgeting for car expenses nor
have they discussed auto financing options (64 percent) with them. With so many
young adults finding the way on their own, the one piece of advice most baby
boomers would offer when purchasing a first car is to do your research, compare
prices, and shop around.

"Buying a car is not an intuitive process and it can be intimidating for first
time purchasers, especially in such a challenging economic environment," said
Sanjiv Yajnik, President of Capital One Auto Finance. "With the increased focus
on the economy and the importance of making smart financial choices, buying a
car presents parents a great opportunity to teach their children the importance
of creating a budget, selecting the right vehicle and choosing the best
financing option for that vehicle."

Capital One Auto Finance`s survey also compares the expectations of today`s
first time car buyers with the experiences of baby boomer parents. Some of the
most surprising results show that boomers and today`s young adults aren`t so far
apart and that practicality is as important today as it was 30 or 40 years ago.
Both groups named price as the most important factor in car buying decisions (49
and 41 percent respectively), and while car prices have increased significantly
over the years, it is surprising that the young adults surveyed predict that
their first car will cost within the same $1,000 to $5,000 price range that most
baby boomers reported paying for their first cars. Not so surprisingly, most
young also adults also plan to purchase used vehicles (67 percent).

In terms of paying for their new wheels, 65 percent of today`s young buyers
expect to follow in their parents` footsteps by paying for their first car
themselves. Most also report that they plan to pay for their first car in cash
(44 percent), up from 29 percent in 2008. Despite numerous financing options
available to today`s young adults, fewer plan to take advantage of the benefits
of bank financing (24 percent) than just a year ago (41 percent). While the vast
majority of the young adults surveyed (nearly 82 percent) were aware that their
credit score could impact the interest rate they would be offered,
unpredictably, 72 percent of those who planned to finance their first car
purchase through a bank or dealership had never checked their credit report.

"The troubled economy has definitely impacted car buying decisions," Yajnik
said. "At the same time, there are incredible deals available at dealerships
across the country and a range of financing options are available. Armed with
the right information, it is an excellent time to get a great deal, but it is
important for first time car buyers to take the time to understand exactly what
a car loan is, calculate what they can afford, understand financing options, and
not to be forgotten - know their credit score and how that score could affect
the terms of their loan."

Helping Young Adults Navigate Car Buying in a Tough Economy

Capital One Auto Finance developed the following tips that parents can share
with young adults to help develop the confidence they need to manage the
car-buying process:

* Learn about vehicle pricing. Research new and used car prices includingdealer
invoice pricing and transaction costs (the Internet can be a great resource).
Know what you can afford and use those target numbers as a reference point for
your pricing information.
* Research and compare different financing options. There is a range of auto
financing options available, including dealer financing, loans from banks and
credit unions, and pre-approved no-obligation online loans. Researching your
options and finding the lowest rate that you qualify for can save you a
substantial amount of money over the life of your loan. It`s also critical that
first-time buyers match the length of their loan to the planned length of
ownership so that they do not become "upside down."
* Treat the car-buying process as two separate negotiations. Determining the: 1)
vehicle price, and 2) financing are two separate transactions, and you should
negotiate each separately. This strategy will often help you save money. (If you
happen to have a trade-in, consider it a third part of the negotiation.)
* Check your credit rating. Don`t assume your young adult does not have a credit
history. Some parents have made their older kids authorized users of credit
cards and cell phones, so it`s important to obtain a credit report to make sure
the information is accurate before buying.
* Make sure you are comfortable with the contract. If it`s not the price or deal
you want, be ready to walk away.

Financial Education Help

Capital One Auto Finance offers car buyers a range of information and tools to
educate themselves, including a free, easy-to-understand consumer auto buying
guide available at www.capitalone.com/autoloans. The guide`s topics range from
budgeting, to learning about vehicle research and shopping, to understanding
financing and payment terms.

Survey Methodology

The findings reported in this release are from an online survey conducted by the
survey opinion research firm, Braun Research of Princeton, NJ. Braun Research
completed interviews with 404 parents between 45 and 55 years of age, all of
whom have at least one child and own a motor vehicle. In addition, Braun
Research conducted interviews with 400 young adults between the ages of 18 and
25 years of age who are planning to obtain their first motor vehicle in the next
year. The interviews were conducted between May 1, 2009 to May 13, 2009. The
margin of error for this study is ± 4.9 percentage points for each group at the
95 percent confidence level.

Sampling for this study was conducted using a national probability replicate
sample for the 48 state contiguous United States. All interviews were conducted
using a computer assisted telephone interviewing system. Statistical weights
were designed from the United States Census Bureau statistics.

About Capital One

Capital One Financial Corporation (www.capitalone.com) is a financial holding
company whose subsidiaries, which include Capital One, N.A., Capital One Bank
(USA), N.A., and Chevy Chase Bank, F.S.B., collectively had $121 billion in
deposits and $150 billion in managed loans outstanding as of March 31, 2009.
Headquartered in McLean, Virginia, Capital One offers a broad spectrum of
financial products and services to consumers, small businesses and commercial
clients. Capital One, N.A. and Chevy Chase Bank, F.S.B. have approximately 1,000
branch locations primarily in New York, New Jersey, Texas, Louisiana, Maryland,
Virginia, and the District of Columbia. A Fortune 500 company, Capital One
trades on the New York Stock Exchange under the symbol "COF" and is included in
the S&P 100 index.

Capital One Financial Corporation
Steve Schooff, 972-295-1676
stephen.schooff@capitalone.com

Copyright Business Wire 2009