Overhaulin'

Brother wants to buy my car. Will co-signing with him hurt my chances for a new loan?

My brother just recently quit a job. He still has one, but it's low income. He can afford the payments I think he would have. I have an excellent credit score, but have put a house and furniture in my name for financing recently. If I co-sign with him, will it hurt my chances of getting a good rate on my own car loan?

Public Comments

1. Yes it can hurt you plus if he doesnt pay their coming for you
2. yes...and if he defaults guess who pays....it may be hard but dont do it
3. Yes it will hurt you, and it is not good for him either. He needs a decent job before buying a car, or he will always be poor.
4. As long as you are a cosigner on a loan,they are going to look at it as if you may have to make those payments one day..It is going to tie you up until that loan is paid in full..
5. NEVER cosign a loan for friends or family.
6. three words DON'T DO IT. these kind of things always turn out not so good. i know you want to help, but you've said it yourself he just quit a job and the one he has is low income whatever that means. if you're putting this questions out there for others to answer its obvious that you're having doubts yourself. go with your first mind. don't let someone else mess up something that you're gonna have to pay for in the end. and if you're thinking about co-signing well see you on judge joe brown
7. I commend you on thinking of your family. You do, however, need to know that the loan will be considered in with your credit rating as an outstanding debt that you owe. If he defaults...you owe the money. If he pays late and doesn't always tell you...it WILL show on your credit report. Ask Mom or Dad to co-sign for him, or let him wait until he finds gainful employment to purchase the vehicle. Sorry.
8. Very simple.......................YES.
9. it will hurt you only if the loan is not kept current and as long as your debt to income ratio doesnt get out of whack for the payment on the cosign.
10. Yes, because when you go to get a car loan for yourself and they run your credit, your brothers car will show up as your own car loan, so it will appear as if you are getting financing for 2 cars.
11. Of course it will. The full amount of the loan will be a liability on your credit rating, not his. If he defaults you will owe the balance of the loan.
12. Would you take out a loan to buy something from yourself??? Of course you wouldn't. That's basically what you are doing here. If you think he can afford the payment let him make payments to you. Forget about the bank. If he falls behind, you'll know right away because he wont be able to hide it from you and it wont hurt your credit. The only issue is with insurance. If your state will allow this, drop the coverage you have and make him get it on his own. That way if there is an accident it's HIS rates that are effected, not yours. I know what your going to say now..."My name is still on the title so why would that matter?" Good point. But if you co-sign your name is going to be there anyway right? So what difference does it make?
13. It's going to come up on your credit report. My husband co-signed for me and now both on our credit history shows the truck and the expense. My husband also has an other truck on his name so two truck/car is ok for one, depeds on income and the price of the trucks.
14. Yes it will. It will also be considered in your debt to income ratio that could affect your whole loan. Whether your the primary or the co-signer your still responsible for the debt and that is how lenders will view it moving for your next loan. There are ways around this but I would not recommend them and I would stay clear of co-signing.
15. If he has a low income job are you sure he can handle any payments? Is it possible to sell or give him another car (maybe your old car or someone else in the family have an extra?) That would really help him the most. He doesn't need the extra financial pressures and you don't need the credit exposure. That being said, if the only way you see to help him is to co-sign and you are sure you want to do it.... And you want to buy a car for yourself, man, seems you are going on a ledge here..but, I would say to buy both cars at the same time. A dealership can get you approved at more than one finance source and contract two notes before the banks know about each other. It has to be done at the same time or within a couple of days of each other. It is a sneaky way to do it, but I have seen it done. Again, I advise against it...but you know better the situation and your tolerance for exposure. Reconsider all options first. Good luck