momto4kiddos
Drama Llama
Posts: 5,153
Jun 26, 2014 11:45:15 GMT
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Post by momto4kiddos on May 30, 2015 11:52:33 GMT
I had to co-sign for my dd to get a car loan last fall. For the record, I had no problem co-signing for her because she's turned into a very responsible person and put down a lot on the car and has very low payments.
On to the problem. So when we did the loan papers through the dealership (loan is with the car makers bank.) I was told I needed to sign first and she needed to sign second. I didn't think much of it at the time as the only co-sign experience I have was more than 25 years ago when my Dad co-signed a car loan (so no idea who signs what and i'm sure things have changed since then.)
So when her payment stub arrived, I thought it odd because it has my name followed by hers on it. Again my only experience is from ancient times and my stubs came through with only my name on them (Dad's was not on it.)
I was going to look into this, but figured i'd let a few months pass and check the credit reports. I checked mine this AM and it shows up under mine and we're "joint" on the account and lists her as the joint account holder. I'll have her pull her credit reports too, but it seems we were set up for a joint account rather than me being just the silent co-signer....
So has anyone else co-signed and now more about this than me? I need to get some information on it and figure it out. I don't particularly care for it showing up on my stuff, but the idea behind co-signing it was that she was making the payments and getting the credit for it (which I suppose she is, but it appears on the report like we're partners in it.)
Car was totaled (no fault of hers) so loan will be paid this week and we'll be starting over so I want to make sure i'm better informed this time around.
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scrapaddie
Drama Llama
Posts: 5,090 
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Post by scrapaddie on May 30, 2015 12:01:37 GMT
It is my understanding that when you cosign for a loan, you are equally responsible. This makes it a joint debt. In case of default, they would come after either party and probably the one that seems to have a better ability to pay. Credit wise, no one is silent on a cosigned loan . Of course all of my "expertise" comes from watching Judge Judy LOL
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marimoose
Pearl Clutcher
Posts: 3,282
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Post by marimoose on May 30, 2015 12:42:27 GMT
My oldest daughter got a car loan and her boyfriend was the co-signer and he was listed first. The car was hers but he had the credit. She did earn credit on her record. I think this is a normal practice, at least now. I know way back in the day that my dad co-signed for me and his name did not show up on my billing statements but I believe it showed in his credit records. This was a long time ago.
Sorry your daughter's car was totaled and hope that she was not injured. That is the most important thing here:)
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momto4kiddos
Drama Llama
Posts: 5,153
Jun 26, 2014 11:45:15 GMT
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Post by momto4kiddos on May 30, 2015 12:59:18 GMT
My oldest daughter got a car loan and her boyfriend was the co-signer and he was listed first. The car was hers but he had the credit. She did earn credit on her record. I think this is a normal practice, at least now. I know way back in the day that my dad co-signed for me and his name did not show up on my billing statements but I believe it showed in his credit records. This was a long time ago. Sorry your daughter's car was totaled and hope that she was not injured. That is the most important thing here:) Good to hear you had a similar experience. I knew things probably weren't as they were 25 years ago, but it was surprising to see my name show up everywhere. I know the bottom line is i'm responsible and i'm fine with that, but I guess I expected to be in the background somewhere like years ago when my Dad signed. Thankfully they walked away uninjured! We are so grateful for that; replacing the vehicle is a blip on the radar at this point. |
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Post by mikklynn on May 30, 2015 13:05:03 GMT
Maybe she'll qualify for her own loan this time. I'm so glad she was uninjured.
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YooHoot
Pearl Clutcher
Posts: 3,432
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Post by YooHoot on May 30, 2015 14:48:00 GMT
Yes, it will show up on your credit report when you co-sign. I bet she could get her own loan now.
My dd was 19 when she qualified for her own loan. We went through her credit union. They had certain criteria to meet (1. deposit of 20% 2. direct deposit of her paycheck 3. had her job for more than 6 months and a few other things like full coverage insurance etc). But she qualified. The rate was good since we went through a credit union. It was a used car too.
I'd suggest getting her preapproved through a bank or credit union and then go car shopping.
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Deleted
Posts: 0
Oct 7, 2024 9:33:35 GMT
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Post by Deleted on May 30, 2015 14:55:03 GMT
There is no such thing as a silent co-signer.
You are jointly responsible for the loan. It will be reporting on her credit report as well, and building her credit.
But, if she defaults on it, you will have to pay or your credit will be damaged as well.
Also, if you need to get credit for anything while this loan is open, the debt service for this loan will be calculated into your debt-to-income ratio and could affect approvals and rates.
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GiantsFan
Prolific Pea
Posts: 8,456
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Jun 27, 2014 14:44:56 GMT
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Post by GiantsFan on May 30, 2015 14:55:01 GMT
When you co-sign you are both equally responsible. Since you have established credit your name is listed first, it doesn't matter who will be making the payments and getting the insurance.
As someone who's Dad co-signed for my first new car, I think it's great that you helped your daughter start her credit history. But the bummer is it's on your report too.
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Post by sincity2003 on May 30, 2015 15:13:36 GMT
Hopefully she has built up some other credit and can get financed in just her name this time. For our own personal reasons, DH and I decided that my next car will be in my name only; however, the banks aren't thrilled with that idea because ALL of our credit is joint.
Also most lenders will exclude a cosigned debt if your daughter shows she is making the payments from her own account.
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Post by pmm on May 30, 2015 18:17:13 GMT
I just cosigned for both my kids last fall to lease new Hondas. My name is nowhere on either of their statements. Although, I am equally responsible for the payment. Fortunately, they are both great kids that are working full time or more.
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Deleted
Posts: 0
Oct 7, 2024 9:33:35 GMT
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Post by Deleted on May 30, 2015 18:44:15 GMT
Also most lenders will exclude a cosigned debt if your daughter shows she is making the payments from her own account. Granted, I work at a (national) bank with a pretty conservative credit culture, but we most definitely do not do this. The fact is, the daughter could stop payments my tomorrow and the OP would be on the hook. When we are calculating debt ratios, we are going to be sure she can cover all of her obligations, including the contingent ones. |
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momto4kiddos
Drama Llama
Posts: 5,153
Jun 26, 2014 11:45:15 GMT
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Post by momto4kiddos on May 30, 2015 19:00:38 GMT
Thanks everyone, i'm more clear on it now. I just wanted to make sure that where it's on my credit that it's also on hers. The point to me co-signing was for it to build her credit (as well as qualify her, lol.) I don't have any concerns about it being on mine or it taking away from what I might be lent. I just want to make sure she's getting credit for paying, which she is.
I may tell her to check around to the credit union as she may qualify there. I did also wonder if she'd qualify at the dealer this time around, but unfortunately she'd only made her 5th payment on the car....all on time, but still only 5 payments.
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