topic Co-sign on loan, using higher credit score? in Auto Loans

Co-sign on loan, using higher credit score?

avv7c0 — Fri, 10 Feb 2012 16:44:35 GMT

My wife and I are currently shopping for a new car. She has a EQ FICO of 710, mine is 814. I'd like the auto loan to be in her name, so that it helps her build up her credit score. But they want to give her a 3.9% rate, while mine would be 0.9%. This adds up quite a bit. So I'm wondering if I cosign on her loan, will they give us the 0.9% interest rate? That way we can build her credit, but still not pay the extra in interest.

Re: Co-sign on loan, using higher credit score?

pizzadude — Fri, 10 Feb 2012 17:05:26 GMT

I would think that they would probably work it this way, honestly it's probably negotiable between you and the finance people..

People use cosigners to get better interest rates, so tell them that you want the .9% deal with both of you on the loan. If they really want to sell you the car then they will go along with it. Or they might split it down the middle, say at 2% or something similar. How badly do you want the car, would you walk out if they refuse the .9% ?

Interest rates are a negotiating point in the sales process, in addition to the actual price of the car. So it's up to you to decide where to draw the line.

Re: Co-sign on loan, using higher credit score?

Anonymous — Sat, 11 Feb 2012 03:00:49 GMT

I've seen and read that usually the rates are based on the primary borrower's credit score and the individual with the lower score would be the co-borrower. You could ask the finance company if they report information to the co-borrower's credit report. Like pizzadude said though, everything is negotiable.

Re: Co-sign on loan, using higher credit score?

Revelate — Sun, 12 Feb 2012 02:58:31 GMT

@Anonymous wrote:
I've seen and read that usually the rates are based on the primary borrower's credit score and the individual with the lower score would be the co-borrower. You could ask the finance company if they report information to the co-borrower's credit report. Like pizzadude said though, everything is negotiable.

Co-signed loans are always reported to both AFAIK.

3% is 3%, as Pizzadude suggested, go ask for it.