a friend of mine is going to get a 05 tsx within a week or so but has no credit. He is going to finance the car and has a co-signer with good credit. My question is, when he goes in and makes a deal for the car, could he use the co-signers credit to finance the car? Cause theres no doubt that using his own credit will end up with a apr thats above 8%.

 

He can use the co-signer if he/she is present.
Also, keep in mind for the co-signer that if the guy that is paying stops paying, it will be 100% the co-signers resonsibility to make the payment. I have heard plenty of stories where people have co-signed and people have defaulted.

 

doesn't the cosigner have to be a parent or guardian? then again "guardian" is such a vague term

 

Nope. But a lot of time the buyer has credit that only his mother could love!

 

If the guy has no credit or even bad credit, he doesn't need to be getting a $28,000 brand new car. He needs to be looking into getting a nice, reliable used car. Getting a new car like that with no credit is a BAAAAAAAAAAAAAD idea, and he's only asking for financial trouble. I don't understand people like that.

Get a nice used car, wait a year to two years, get the credit score back up, and then try again.

If he gets this car, and then defaults on the loan, now there are TWO people with ruined credit if the co-signer defaults.

I would never, NEVER co-sign on ANY loan, whether it's for my wife, kids, parents, whatever. You're asking for trouble.

He should watch Suze Ormand on CNBC.

 

i know this guy with a 80-90K miles pontiac and has monthly payment of 600 bucks.. cause his interset rate is 24%... that is messed up....

 

Ya, i would pass on this deal. Kinda like everyone else said that if this guy has NO credit how do you know how he's gonna handle a car payment each month. Its a big jump if he has no credit from not having credit cards or other payments to paying 400+ per month for a new 28k car.

Tell your buddy to get a used car and build up his credit that way.

 

out of curiosity. how old is ur friend.. what does he do ie:monthly income? and why bad credit.... and who the heck is willing to co sign?

 

Having a co-signer isn't always bad. I messed up my credit pretty badly when I was 18-21 and still have lingering effects because of it. I had to use a co-signer on 3 different car loans between then and now and I have yet to miss a single payment. I finally got all of my credit issues cleared up and I was thrilled when I was approved with tier 1 credit BY MYSELF when I picked up my 05 TSX just over a week ago! I would be very cautious about co-signing for someone and I would definitely make sure that I knew their exact financial situation before doing so. If you know that they'll be able to make the payments, then go for it. It can affect your credit positively just as easily as it can negatively affect it!

 

Knew a guy who was told he had to have a co-signer. He never had a credit card (this was years ago), never borrowed money and so he literally never had credit. He got mad, went to another dealer and just paid cash.

So needing a co-signer does NOT mean bad credit or can't afford the car, although I have to agree, often does!

 

heh. my co worker never used his credit card in years and paid everything in cash. when he got denied applying for credit and got high interest on car loans he was so pissed, took me 10 mins to explain that he need to have credit card and acutlly use it to have credit!!!!!!!! being responsible and pay for everything in cash just does not fly anymore in this day and age.......he is still mad i think... hahaha