You usually don't need a cosigner for a car loan, but you may be required to have one if you have bad credit. A cosigner is somebody with good credit who signs on a loan in order to help the primary borrower get approved. Having a cosigner can provide other benefits as well.

Who Can Be a Cosigner?

Do I Need a Cosigner for a Car Loan?A cosigner can be anybody you feel comfortable asking, whether it be a friend, family member, or coworker. The only catch is that whomever you choose has to meet the lender's cosigner requirements.

This generally means they need to have good credit (usually a FICO credit score of at least 660 or higher), and enough available income to qualify for the auto loan. Although the income requirement varies, most bad credit lenders require a minimum income of $1,500 to $2,000 a month before taxes – the same goes for the primary borrower.

Benefits of a Cosigner on a Car Loan

Regardless of whether or not a lender requires you to have one, there are benefits to adding a cosigner to a car loan. To begin with, it can increase your chances of being approved, since you’re adding someone with a good credit history to the loan.

Adding a cosigner could also help you save money on the auto loan by allowing you to qualify for a lower interest rate. Bad credit borrowers tend to get approved for higher than average interest rates, so this can make a big difference in the amount of interest charges you pay in the long run.

Keep in mind that the auto loan shows up on both the primary borrower's and cosigner's credit reports. This means that the loan affects both of your credit scores, so keep your cosigner's credit in mind and don't take this agreement lightly. Make sure you’re on top of the monthly payment, and keep your cosigner in the loop if anything goes wrong or you need their help.

Ready to Find Financing?

The bottom line is this: a cosigner is there to help you qualify for a loan. You may not like the idea of needing a cosigner if the lender asks for one, but you can always improve your credit score over time and remove them by refinancing the loan down the road.

Whether or not you have a cosigner ready, Auto Credit Express can help you find financing if you're dealing with less than perfect credit. We work with a nationwide network of special finance car dealerships, and we want to get you connected to one near you.

Get the vehicle you need and the chance to build your credit. Start the process today by completing our auto loan request form.