topic Re: My daughter may need me to cosign on an auto loan..... in Auto Loans

My daughter may need me to cosign on an auto loan.....

jamevfan — Wed, 29 Jun 2016 23:29:35 GMT

Just as a history ive recently over the last few months have been working really hard and successful on my credit and have made great progress. My daughter got a 1997 honda as a graduation give in 2015 as a gift from my sister which we appreciated however this car had had its issues and continues to break down and is now constantly running hot and just 2 weeks ago we replaced the radiator and it is still running hot and when visiting the dealership just to see if she can do anything as far as financing under the 1st time buyer they said her income was too long at 2 different dealers but brought up needing a cosigner in which im reluctant to jump and do being wherer ive beeen with my credit.....she makes 700 every 2 weeks and has had a stable work history for the past 2yrs. She is a fulll time college student but is still green to credit and life, she recently got a secured capital one card but it has not reported yet and she has no ither credit, i was told i was needed for income reasons on the loan but i really dont want to and will only do it as a lat resort but i dont want her stranded as she was today and we had to call a tow and also last week.....any other options? Or experiences that can help?

Re: My daughter may need me to cosign on an auto loan.....

Anonymous — Thu, 30 Jun 2016 01:41:16 GMT

You could try to see if she qualifies with the Capital One auto pre-qual thing. It worked for me and I have questionable credit. At least you know where she might stand interest rate wise. Otherwise the only way you would be able to help her without co-signing is helping her with a hefty downpayment to reduce the risk that the bank is taking. That's all I can think of off the top of my head.

Re: My daughter may need me to cosign on an auto loan.....

jamevfan — Thu, 30 Jun 2016 01:47:52 GMT

Ok. The issue was she made 85 dollars less a month than required.... i dont want a car in my name due to the risks and me still building but i want ro help my daughter so much

Re: My daughter may need me to cosign on an auto loan.....

Anonymous — Thu, 30 Jun 2016 02:10:15 GMT

I wasnt saying for you to take on the loan. I mean help her with the downpayment, Im watching this close because my daughter is close to being 18 and Im curious how it goes.

Try this Capital One Auto Navigator

There is a button at the top that says pre-qualify. Click it, put her information in, and then see what happens. If she is pre-qualified, then she will have a list of dealers and cars she can go for. Most of the time there is no downpayment, it will just depend on the LTV rate of the car. I just did this a few weeks ago and got out with exactly what they said I would payment and interest rate wise.

Good luck

Re: My daughter may need me to cosign on an auto loan.....

jamevfan — Thu, 30 Jun 2016 14:13:12 GMT

Did it and she got the 7-10 day letter msg saying that she does not qualify for this as of now. We got her atarted on a capital one secured card so we will try and fix her car and wait a few months if we can to see if her payment history reporting will help..... other than that im clueless

Re: My daughter may need me to cosign on an auto loan.....

p- — Thu, 30 Jun 2016 14:49:44 GMT

jamevfan wrote: ... i was told i was needed for income reasons on the loan but i really dont want to and will only do it as a lat resort...

You shouild only cosign a loan if you are willing and able to make the payments if the person you are signing for stops making them. This forum is littered with sad stories like this, and it's possible that she could get laid off or have some financial difficulty that leaves you holding the bag. You would be better off gifting her some down payment money, or advising that she look for a cheaper car.

Re: My daughter may need me to cosign on an auto loan.....

Anonymous — Thu, 30 Jun 2016 16:30:34 GMT

If she was that close to qualifying on a new car, try used. If you were already looking at used, try looking at something smaller/with less options/otherwise less expensive.

Something a couple of years older with some mileage on it, that costs a couple grand less than the one she was looking at but didn't qualify for, would have a lower payment. The lenders seem concerned not with her credit but rather her DTI. She needs a car where the payment plus the minimum on her credit card (presumably, that is going to be about $25 a month) will be less than 30% of her income on a monthly basis.

Manufacturers' first-time buyer programs can often be used for Certified Pre-Owned or other types of used vehicles in the dealer's inventory.

Dont' forget that a financed vehicle (new or used) will be required to have full coverage insurance, too - and that failure to provide it equals a default on the contract - so keep that in mind too when considering cosigning. As prior poster said, you have to be ready and willing to make the payment if the primary doesn't, and that includes also making the insurance payments. As you already know, it's a risky thing, but parent-child cosigning can work if you have a responsible child and it's the only way to get a dependable vehicle.

Re: My daughter may need me to cosign on an auto loan.....

jamevfan — Thu, 30 Jun 2016 17:51:49 GMT

i dont want her to be over her head in debt while trying to finish college, my husband fixed the issue with her current car for now and we will see how it goes and look at a cheaper used vehicel if we have to latter down the road, her liability for her current car is 175 a month i couldnt imagine full coverage payments....we will work with and for her as long and as much as we can but she just see having anew car without weighin the pros and cons, she is responsible but having a car payment insurance and credit card will tie up most of her monthly income which is what im worried about as far as the long term of the loan, a kia dealership said they have her approved but not for a car that they currently have on the lot so they are waiting on a "shipment" but its for a used cheaper vehicle supposedly..

Re: My daughter may need me to cosign on an auto loan.....

jeffm4688 — Fri, 01 Jul 2016 00:45:57 GMT

I've seen some forum members post about having problems with co-signers and then i've obviously seen the opposite. My first three cars were financed jointly between me and my grandmother and I never had an issue making the payments. I also picked a cheap little $11K car at the time with payments in the $200 range which got 35 MPG (chevy cobalt @ the time). I got 200K miles out of my first car after buying it with 35K. I may now have a more expensive car, but I also graduated and had a salary before purchasing an expensive vehicle, or two.

All I can say is, if you end up co-signing make sure you pick something inexpensive, reliable that is affordable. Also bear in mind, if both of you are on the loan/regi insurance may very well be cheaper, especially on a newer car. I've got no idea how the insurance numbers work, all I know is a brand new $60K truck costs me $130 and a $35K auto used to cost me $200. So I'd look into insurance quotes on a bunch of different cars.

If you deicde to purchase something and co-sign I'd very much consider going into either a local credit union or potentially penfed and ask if you can get a pre qualification and at what rate before you go into a dealer and and kind of go "what can i afford to take home", because you'll then have some negotiating power and know if your being taken for a ride.

Re: My daughter may need me to cosign on an auto loan.....

jamevfan — Fri, 01 Jul 2016 00:57:37 GMT

Awesome Jeff! Thanks a bunch we will be fixing her car until we can get her some credit history or better loan terms with me as a Cosigner but we will be careful whichever method we go