A cosigner can be a great way to help you finance your car if you don’t have the perfect credit. An auto loan cosigner is simply a person who is willing to sign on for your loan saying if you don’t make your payments, they will pay for you.
The reasons you need a cosigner could vary, but some of them could include:
-Your debt-to-income ratio is too high
-You don’t have credit or your credit score is poor
-Your income varies
If one or more of those factors applies to you, you may need to find a cosigner. Remember, a cosigner is responsible for paying the car loan if you cannot, so not just anyone will be willing to be a cosigner for you. Oftentimes a parent or close family member will be who you would consider to cosign for you.
There are some cosigner requirements to keep in mind when you are finding someone to help you out. First, the point of a cosigner is insurance that the payments will get paid, so your cosigner will need to have a great credit score. Your cosigner will also have to prove that they would be able to make your payments if the situation arises. That means they would have to provide proof of income and/or tax returns of some sort.
A cosigner may be something you need to get the auto loan you’re looking for. At the very least, it could be something you look into. If you have any questions about auto loans or financing, let us know!