topic Re: Refinancing My Fiancée's Car in Auto Loans

Refinancing My Fiancée's Car

stellarrr — Wed, 24 Apr 2013 07:18:13 GMT

My fiancée has pretty crappy credit; I believe he said when he initially financed his car, he found out his score was 599-ish. He has had his car for about a year and a half. Right now, he owes about $16k on it. He wants to refinance but I don't think he'd get a better interest rate. I was thinking that maybe I could co-sign for him on the refi... But I am unsure if I can do so with a FICO score of 665. Is this even possible for me to do?

Re: Refinancing My Fiancée's Car

Anonymous — Wed, 24 Apr 2013 15:33:26 GMT

How much is the car worth? Year, make, model, features, miles ect.

Do you have a means to repay the debt? Otherwise the bank would not have any use for you on the loan.

Why do you want to be on the loan? It is better to keep only one person on the loan. That way if the loan goes bad, it only effects one score. Then the other can still take out loans as needed.

Re: Refinancing My Fiancée's Car

sccredit — Wed, 24 Apr 2013 16:13:15 GMT

@Anonymous wrote:

Why do you want to be on the loan? It is better to keep only one person on the loan. That way if the loan goes bad, it only effects one score. Then the other can still take out loans as needed.

Agreed. Don't sign for debt for anyone not your spouse

Re: Refinancing My Fiancée's Car

Walt_K — Wed, 24 Apr 2013 17:15:20 GMT

@sccredit wrote:
@Anonymous wrote:

Why do you want to be on the loan? It is better to keep only one person on the loan. That way if the loan goes bad, it only effects one score. Then the other can still take out loans as needed.
Agreed. Don't sign for debt for anyone not your spouse

I know a lot of people say that, but I would put it differently. Don't sign for debt for anyone unless you are willing to make the payments if they cannot. So long as you're willing to make the payments if they cannot, then it doesn't matter who it is.

Re: Refinancing My Fiancée's Car

stellarrr — Wed, 24 Apr 2013 17:37:47 GMT

The car is a 2008 or 2009 Nissan Altima 2.5S, fully loaded... Leather, navigation, back up camera, sun/moonroof, BOSE stereo, etc. The sticker price was about $18k or $19k but he ended up paying about $22k for it. It had 15k miles on it when he bought it. His payments are $523 a month and he's had it for about 19 months. So, doing the math now, he owes about $12k on it. His interest rate is higher than Snoop Dogg. He's never missed a payment, either. I believe his term is 60 months but at the rate he's going, couldn't it be paid off within the next year and a half? The reason his credit is in the toilet is because his name was on everything from his previous marriage. After the divorce settlement, his ex-wife stopped paying on the vehichle he had gotten her and she open a credit line with a jewelry store in his name. They've been divorced for six years, now and he's trying to fix what she did.

I want to be on the loan because I want to diversify my credit history; it's very limited. I have one credit card and a student loan out for $5k. Over the last two and a half years, I've been very responsible with money because I want to improve my credit. Am I going about this the wrong way?

Re: Refinancing My Fiancée's Car

sccredit — Wed, 24 Apr 2013 21:16:01 GMT

I will only address what you are looking at dealing with on the refinance. I won't touch life decisions, I already made my $.02 made on that one, made from experience.

How many miles are on the car? Often times it can be harder to refinance a vehicle with more than 100k miles. Also, be sure of the payoff, that looks like it would be cutting it close on LTV.

Re: Refinancing My Fiancée's Car

stellarrr — Wed, 24 Apr 2013 21:42:23 GMT

And I thank you for your input; it's proven helpful. There are 75k miles on it, now. His commute to work is 50 miles one-way. Please school me on the loan-to-value. I'm a super noob.

Thanks!

Re: Refinancing My Fiancée's Car

Anonymous — Thu, 25 Apr 2013 01:20:48 GMT

@stellarrr wrote:
And I thank you for your input; it's proven helpful. There are 75k miles on it, now. His commute to work is 50 miles one-way. Please school me on the loan-to-value. I'm a super noob.

Thanks!

A bank looks at the value of the asset vs the amount of the loan needed to pay off the car. The lender wants the loan backed by an asset worth more than amount of the loan.

Re: Refinancing My Fiancée's Car

webhopper — Thu, 25 Apr 2013 02:18:59 GMT

@Walt_K wrote:
@sccredit wrote:
@Anonymous wrote:

Why do you want to be on the loan? It is better to keep only one person on the loan. That way if the loan goes bad, it only effects one score. Then the other can still take out loans as needed.
Agreed. Don't sign for debt for anyone not your spouse
I know a lot of people say that, but I would put it differently. Don't sign for debt for anyone unless you are willing to make the payments if they cannot. So long as you're willing to make the payments if they cannot, then it doesn't matter who it is.

Welcome to the Forums!

Do not co-sign unless you'd be willing to make payments on this car without ever have driven it, even if he is long gone...

by the way, my husband had that same problem. We are using the Identity Theft procedures to get the information blocked on fraudulent accounts.

I wrote a guide that is in the general credit forums... You can find it here

Re: Refinancing My Fiancée's Car

StartingOver10 — Thu, 25 Apr 2013 16:09:28 GMT

Did you see the loan balance on the loan from his lender or from the amortization schedule?

If you just made a calcuation based on the payments without taking into account the monthly interest than the payoff wouldn't be accurate.

I agree with the others - getting on his car loan isn't worth the risk IMHO. You already have an installment loan on your credit, student loans.

He has only been paying on the car for a very short time, 19 months. It is long enough that he can refi on his own with a credit union. That will help his payment drop depending upon the interest rate he is paying now and the rate the CU offers him. It really is best to keep your credit separate in the long run. If something happens to one of you, then the other one can still be in a good position (as mentioned in a post above). Think about your credit in a strategic manner and read Webhoppers post.

Re: Refinancing My Fiancée's Car

rios138 — Thu, 25 Apr 2013 20:46:41 GMT

I have crappy credit and just refinanced my car through capital one auto finance. I think my score was about a 577 FICO when I applied.

My rate dropped from 15.99% to 10.26%. I had 60 months left and about $17500 ($430/mo) approximately left on the loan and refianced it for 48 months (@$450/mo) and the payment only went up $20 . I think I will end up saving about $4k.

Re: Refinancing My Fiancée's Car

maiden_girl — Fri, 26 Apr 2013 03:01:14 GMT

I agree with the other posters...don't sign on to his debt especially when he is not officially your spouse then you might not get married...got forbid and you'll be signed onto the duration of the loan. Not a good idea.

Re: Refinancing My Fiancée's Car

dabrian — Sat, 27 Apr 2013 18:58:00 GMT

Please don't cosign on this or anything else ever.

Re: Refinancing My Fiancée's Car

webhopper — Sun, 28 Apr 2013 23:07:31 GMT

My husband had a crappy 22% rate with gm financial. While I wasn't willing to cosign the refinancing of the debt. I was willing to pay the total amount off for him. We've been married for a year and even now I am comfortable with the decision, because I was willing and able to pay off his car because I knew beyond a shadow of a doubt that he wasn't marrying me for money and that it was all going to work out.

He never asked for me to do this, but it was the right thing to do in my situation.