Let us help you understand everything about your next joint auto loan! Check out our full guide on joint auto loans!
We understand that cars can be pricey, and in some cases, it’s difficult to find the proper information which can save your financial spending. Buying a vehicle is not that easy, we have to look at many things before buying a car. It’s a tedious task, requires a lot of planning, we have to find the best auto insurance policy, banks to provide auto loans, etc.
One wrong decision and you have to do everything again or might end up spending more, that you don’t want at all. We’re here to help you with your auto loan. So, let’s discuss what is a joint auto loan and a few other questions which we found people were asking while doing our research.
We care about our customers’ satisfaction at Mount Shine, that is why we wanted to explain everything about Joint Auto Loan. This way most of the questions will be resolved, and people will get to know more about joint auto loans. So let’s get started.
What Is A Joint Auto Loan?
When a car loan is shared by two people – typically spouses, it is known as Joint Auto Loan. Both of them sign a contract and agree to share a car loan along with its benefits. But if things go wrong, it can lead to disadvantages too. So, make sure you read the article till the end to all you need to know about joint auto loans.
Cosigner or Co-Borrower?
Co-Borrower or joint applicants are the applicants who share the ownership of the vehicle. As joint applicants are married, their incomes are added to meet the requirements for joint auto loans, and both names are listed on the title.
Whereas, cosigners, on the other hand, don’t have any rights or ownership of the car. When the primary borrower is unable to make the auto loans payments, it’s the cosigner’s responsibility to pay the auto loan.
Both cosigners and co-borrowers increase the chances of getting approved for a joint auto loan. In the case of joint applicants, their incomes can be added to meet the criteria for getting an auto loan approved, but this doesn’t happen. A cosigner should meet the income requirements as an individual, as well as have an excellent credit score.
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What Are The Benefits of Adding a Co-borrower to Joint Auto Loan?
We would advise you, that whenever you plan on buying a new car or truck or any other vehicle, you should opt for a joint auto loan. There are 3 benefits to it and it will help you save your finances. Let’s understand those benefits one by one.
There are 3 big benefits to adding a co-borrower to a joint auto loan:
1. Commingle funds
2. Lower interest Rates
3. Get Large/Big Loans
1. Commingle funds
In this case, if you have a low income but by adding your spouse’s income, both of you meet the criteria for getting your joint auto loan approved.
2. Lower Interest Rate
In this case, you can get a lower interest rate if your co-borrower has an excellent credit score. With this, you might get better interest rates and save your finances.
3. Get large/Big Loans
If you alone meet the eligibility criteria for getting an auto loan, by adding the co-borrower you can qualify for a bigger loan with the additional income of the co-borrower.
For example, if you plan to buy honda civic 2022 or earlier models, you can add a co-borrower to avail of the benefits.
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Car Loan Joint or Individual Loan Is Better?
Having a co-borrower or a cosigner has its own benefits that we have discussed above. But what happens if you are an individual? There are options for this one too.
It might be difficult for an individual but not impossible. There are many banks and companies that provide auto loans to individuals. The only thing they worry about is a better credit score and the ability to pay the amount on time. Remember there wouldn’t be as many benefits as there were with a co-borrower or cosigner.
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How To Know Your Joint Car Loan Credit Score?
There are many auto loan companies that generate credit scores for free or at a minimal charge. USA [Dot] Gov is one of the trusted sites where you can check your credit score.
Whose Credit Score Is Used On A Joint Auto Loan?
This is one of the important questions: whose credit score is used on a joint auto loan? While doing our research we read this line which is perfect in this situation i.e.:
“Incomes can be combined, but credit scores, unfortunately, cannot.”
Both you and the co-borrower must have good credit scores to meet the lender’s requirements for an auto loan. The lender will check your payment history, credit scores, and other financials.
How To Remove a Joint Applicant From Joint Auto Loan?
Let’s suppose, something happened, and now you and your co-borrower no longer wish to share a car loan, how to remove a joint applicant from a joint auto loan?
Such cases are like when you both go for divorce, then the option left is to either refinance your current auto loan or resell your car. As both you and your spouse have signed the contract, this is one of the ways to remove a joint applicant. This also applies to removing the cosigner applicant’s name from the auto loan. Refinancing means you replace the current car loan with another auto loan. All you need to do is the permission of the co-borrower to refinance. In the case of a cosigner, permission is not needed but still informing them would be a good option. This way there will be no obligation made by any of them.
How To Apply For A Joint Auto Loan?
Now that you know everything about joint auto loans, it’s time to apply for it. Let Mount Shine help you as we have a wide network of the best finance dealerships across the United States.
Check Online & Get Free reports of your credit score, eligibility for auto loans, and quotes by contacting us. Our service is free, fast, and simple, so get started today!
FAQs On Joint Auto Loans
How to get a joint auto loan in 2022?
Joint Auto Loan is provided by various auto companies where they check applicants’ eligibility, and based on that a joint auto loan is sanctioned. If you have bad credit, a combined automobile loan might be preferable to a single-car loan. Both of you must be able to show documentation of your income, employment, and place of living (usually at the same address), as well as two personal references and a joint down payment.
Q4. Joint auto loan: who should be primary?