Refinancing auto into wife's name

Anonymous · ‎08-07-2016

I'm trying to get a conventional mortgage but DTI is way too high. Lender recommends I refinance my car get it out of my name and into wife's name.- she won't be on the mortgage. Problem is she has no income. I have an existing Volkswagen car through Volkswagen credit? Is there any possible way to do this? Her credit scores are TU - 676. Equifax - 661 and Experian - 659. Balance of about 17 grand on the car. Thanks for any insight on this.

Anonymous · ‎08-08-2016

It will be impossible with no income. And you are likely to have the same outcome in the sense that you will have to co-sign and use your income. In that case, it will show on your credit report and will be factored into your DTI.

Anonymous · ‎08-08-2016

I'd agree, she's not going to get a lona on her own with no income.

In the scenario where you cosign to use your income, the only time that is beneficial is if her scores are better than yours and can help lower the payments, which could help your DTI a little bit. However, her scores are not high enough to yield prime lending rates on auto loans (typically, that happens above 680) so I don't foresee a lower payment with her on the loan than you have now, without her on the loan.

It's a no-benefit idea; your lender is trying to help you focus on your DTI, but without a verifiable income, your wife cannot help unload any of your debt (anything you cosign on will still appear, as mentioned earlier).

Anonymous · ‎08-08-2016

One last heave here. We are in the same business together as an LLC. So she signs tax returns with me also. Would they look at this as income or still have to use a cosign because of her scores? Thanks guys

Anonymous · ‎08-08-2016

I'd still expect her to need a cosigner.

Being listed as a managing member or whatever on an LLC does not translate easily into personal income for purposes of lending applications. If the LLC paid her a salary, yes. Just being a signer of the corporation's tax returns (which do not lest her as a party that the corporation has paid that year), no.

Anonymous · ‎08-08-2016

What kind of scores does she need to refinance? She was preapproved by Capital one for $35,000. I assume she needs to be at 680 at least to get with PENFED of Navy credit union right?