Have I gone too far?

[michaels88369]

Lets just start out by saying im 21 years old and turn 22 in 5 months so you can tell me if i made a dumb mistake. ok, i bought my first car when i was 19 and financed it through Capital One for a whopping 16.78% interest at 448.05 a month. But i was the cosigner with who is now my now wife. That was in August '08. for a 6 year note. I have made perfect ontime payments and more then the minimum for the 21 months that i have had it. And recentaly bought my house in January of this year through the USDA for 151,000 at 534.65 a month. I got a call the other day from my brother which is 19 and asked if i would cosign on a 2010 nissan sentra SR. with him since hes new to credit, i was reluctant but i went with him anyway and tried the loan with just him and he was denied for not enough established credit. That was through our local CU. Then we went to Nissan and tried there. He was approved for 15+% interest. Then they put me on as a cosigner and was approved with 0% for 60 months at 354.01 a month. I know 100% he will make the payments but did I hurt myself by doing that or will it help me moreless in the long run becuase i am now on 2 car notes and a house not counting the other stuff i have on my credit report. I think i need to forget my ssn until both cars are paid for and my reports have time to age. What do you guys and gals think? Did i make a mistake or did i do the right thing for helping out my 19 year old brother? I make right at 35,000 a year and could pay everything if he defaulted but i know he wont. (cross fingers)

[MarineVietVet]

You've already done it so my opinion about any co-signing doesn't matter. 

What do you mean by I think i need to forget my ssn until both cars are paid for and my reports have time to age

From a BK years ago to:

9/09 EX pulled by lender 802
3/10 EQ- 800
4/10 TU -772

You can do the same thing with hard work

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[theo78]

As long as he makes the payments you will be fine. Just don't go looking for a bunch of new credit for a year or two unless you really need it. You need to let your brother know he needs to tell you if he cant make the payment for any given reason, that way you can make the payment and preserve BOTH of your credit. If he can't make the payment make sure he doesn't HIDE it from you. Make sure he knows its important that you know if a situation like that arises so you can take care of it.

[MarineVietVet]

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@rohardi wrote:

As long as he makes the payments you will be fine. Just don't go looking for a bunch of new credit for a year or two unless you really need it. You need to let your brother know he needs to tell you if he cant make the payment for any given reason, that way you can make the payment and preserve BOTH of your credit. If he can't make the payment make sure he doesn't HIDE it from you. Make sure he knows its important that you know if a situation like that arises so you can take care of it.

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I know he's your brother but you need to monitor this account regularly to make sure it is always current. IMO the best way to do this is set up an online payment account that both of you have access to. The last thing you need is a surprise late payment. (not saying that would ever happen )

From a BK years ago to:

9/09 EX pulled by lender 802
3/10 EQ- 800
4/10 TU -772

You can do the same thing with hard work

Credit Scoring 101
Common Abbreviations
Frequently Requested Threads
Whats In Your FICO Score

[michaels88369]

I will do that, and i will make sure the car is paid for EVERY month. What i ment was i will not apply for anything else for atleast 2 years maybe longer. I have everything i need at the moment. Just let everything age and watch my scores grow.

[Chris123nTx]

Since you have already done this it is a moot point. The best advice now is as was said set up that online account and monitor it often. The best advice I was ever given was never ever under any cicunstances co-sign anything for anyone ever. You must not watch judge Judy! Seriosly though my daughters b/f got his parents to co-sign for a 30k car for him. He defaulted in less then a year and they are stuck. Companies that won't offer credit to someone usuLly have history and statistics on their side so you have taken on the risk that they were afraid to. Good luck buy stay on top of it - and never do it again.

[ficonewbie01]

I think you did the right thing to help your brother out. He's your family. A long time ago, my brother had cosigned for an auto loan which I never missed or had late payments. We did set up an online account that both have access to. He even setup his bank information, just in case it was needed. All in all, if there is trust between you and your brother and you are confident that he will pay the loan then you have nothing to worry about.

[Anonymous]

you did the right thing ......now u should do a right thing for ur self and refin ur car and get lower apr  and stop paying 16% and get 3.99 from ur CU

[Anonymous]

As long as a co-signer is treated as a joint account...?

Anything that may have affected your score to lower it is short and temporary. If you were short an installment it would help your score once paid in full.

I think you were very nice to co-sign and don't see a negative side other than the inq and debt responsibility. I'd also log in to the credit account monthly to be sure payments are made on time just to be safe. I'd do the same thing as long as I could afford to pay the debt should the other side fail. The most punishing thing is the hard inquiry if it all works out.

Na, no real negative side, possible minimal point gain in the future. Not enough in your case where I'd go looking for an installment just to have one, but don't see the harm (besides the inq) in helping him as you did. :-)

The interest rates are seriously high though. 15% and 16% rates on any large amount make paying a loan difficult. The new loan in the short term may lower the score making it more difficult to refinance your existing loan. If your brothers loan has not hit your credit report yet, try to refinance your loan asap for a lower rate. You may also request a reduced rate from your current lender since it's been a while since you opened your loan.

[Uborrow-Upay]

Like marinevietvet already said, opinions don't matter now, it's a done deal.  The time to ask is before you act.

I'm just wondering if you took care of your own auto financing first, which you should have done.  Specifically, did you get rid of the Cap One auto loan and re-fi it elsewhere (at a reasonable rate) before helping out your brother?  As I recall, you were having difficulty doing that because you were upside down on that note to the tune of over $6k.

So, your brother now has a 0% rate and reasonable payments.  You've got a 16.78% rate, with high payments, and I don't see you getting re-fi'd for that in the near future what with you being on two car notes already, plus the house, etc.    Do you see anything wrong with this picture?

Did your brother approach your grandfather for help first, before he came to you?  If so, I know what Grandpa said.  And he was right.

michaels88369, it's great that you want to help family, but if you put yourself in a weak position, you won't be able to do that in the future.  You've got to watch out for your own finances first, or there's no help that you can give to them or anyone else.  God forbid that you lose your job, or your hours get cut...or your brother doesn't pay as agreed.

You should not have done this.  Don't do it again, for anybody.

You did go too far...the only thing to do now is to hope for the best, keep on top of this arrangement, and make sure those payments are made by your brother on time, every time.

Good luck with everything, your heart is in the right place, but financial decisions should be made with your brains.