Easterns Blog

A poor credit score can make getting the financing you need for a car frustratingly difficult, as some dealerships turn shoppers away because of an arbitrary score without looking at their income or personal situation. At Easterns Automotive, we don’t believe that shoppers should feel forced to buy a low-quality vehicle because of their credit score.

Our financing team works with dozens of lenders to ensure we’re able to find a workable solution for every type of car buyer. After all, we’re the “Where Your Job Is Your Credit” auto dealership.

There are some ways in which even people with lower credit ratings can potentially qualify for traditional car financing. One option that may make approval more likely is enlisting a cosigner for assistance.

What Is a Cosigner?

A cosigner is an individual who agrees to pay any debt if the signer misses their payments or defaults on their loan. They’re typically someone close to the borrower, like a parent or a close friend. The ideal cosigner is one with a good credit score, solid income and minimal debt.

Cosigners with traditional full-time jobs are typically preferable. Even if they have a lucrative income as a freelancer, a lender may be less likely to accept the cosigner – and consequently you as a borrower – without having an employer to cross-reference.

A cosigner shouldn’t be confused with a co-borrower. Unlike a co-borrower, a cosigner isn’t entitled to any of your allotted funds – what you receive is yours. Instead, they act similarly to a sponsor. They provide the bank with an additional source to seek payment from if you miss a monthly payment, giving them more confidence to loan you the money you require.

Pros and Cons of Having a Cosigner

Securing financing with a cosigner can not only better your chances of having your loan application approved but also help you obtain more favorable interest rates. Paying less in interest can enable you to spend more on a better vehicle, buying a high-quality car that will give you long-term value. At Easterns Automotive, we rigorously inspect and refurbish each of our pre-owned models to ensure they can last buyers another hundred thousand miles or more.

Although a cosigner can’t directly improve your credit, they can help you build or repair your credit indirectly. Making timely payments in full on an auto loan is one of the most reliable ways to improve your credit score, putting you in a better financial position where you may not need a cosigner again.

However, if you fail to make a payment, you can hurt your cosigner’s credit score, negatively impacting their financial future. Alternatively, if you default on your auto loan, they will have to pay the full amount on the loan, including interest and other extraneous fees.

In extreme cases of missed payment, cosigners can even be implicated in lawsuits between you and the lender. All these scenarios can cause irreparable damage to your cosigner financially and emotionally, jeopardizing your personal relationship with them.

Getting a cosigner for your auto loan has high stakes, as your actions will impact both your and their credit scores and financial well-being. But as long as you’re confident you can pay regularly and on time, the drawbacks are minimal.

When Should You Request a Cosigner?

You should get a cosigner if:

• You have a poor or limited credit history
• Your income isn’t sufficient to get the loan you need on your own
• You only need assistance with the initial cost and have the funds to fulfill your monthly payments

You shouldn’t get a cosigner if:

• You have a good credit score and reliable income
• You want to manage your finances independently
• You’re concerned about the risks of involving a personal relationship in your credit history
• You don’t think you’ll be able to keep up with payments due to job instability or other living expenses that limit your monthly budget

Can You Still Be Denied With a Cosigner?

Yes, although it’s less likely if the cosigner has a good credit history. Even with a reliable cosigner, if you don’t have a stable income, auto lenders may turn you down. At Easterns Automotive, we’ve helped customers attain a reliable auto loan for years and will strengthen your application to give it the best chance of being accepted by one of our many auto financing partners.

We Make Car Shopping Easy and Simple for Buyers With All Types of Credit Scores

At Easterns Automotive, we’ll find the loan you need on your terms. As long as you’re employed, you should be able to obtain a high-quality, pre-owned vehicle. Our customer-focused team offers flexible financing options tailored to your current situation and not your credit history.

Trust the team that’s won DealerRater’s “Consumer Satisfaction Award” seven years in a row. Learn more about our financing options and how they can help you secure a certified pre-owned vehicle for a low price online or visit us in person at one of our dealerships today.