If you're having trouble getting a car loan in Seattle, it might not be your credit. You also have to meet several income requirements that lenders have. If you’re missing just one component, it may result in you getting turned down. However, there is a way you can make up for a lack of income if that's the problem: by adding a co-borrower to the loan.
Benefits of a Co-Borrower on a Car Loan
Typically, subprime lenders that work through bad credit car dealerships in Seattle require a minimum income of around $1,500 to $2,000 a month before taxes from a single job. If you can’t meet this requirement on your own, a co-borrower could help.
You can combine incomes with a co-borrower who is your spouse. This means you can add up both of your incomes and qualify for the loan together. This could be just the boost you need to hit the income marks your lender requires.
Risks Involved with Co-Borrowers
Getting a co-borrower isn’t something you should do lightly, or with just anyone. When you add a co-borrower to your loan, you’re also giving them co-ownership of the vehicle you’re financing.
Because you’re both on the loan together, your co-borrower doesn’t have to meet the lender requirements on their own. However, because you’re qualifying as one, this means that everything that happens with the loan – both good and bad – impacts both of you.
So, if you stop making payments, your co-borrower has to pick up the slack, or else both of your credit scores are going to drop. If the car is repossessed, the negative impact of that shows up on both of your credit reports, and so on.
Don’t Confuse Co-Borrowers with Cosigners
When you have a co-borrower on your loan, they can not only help with income issues, their credit can be helpful. For this reason, it’s a good idea to have a co-borrower with better credit.
Co-borrowers, however, shouldn’t be confused with cosigners. Cosigners can only help if you need to borrow their good credit because yours alone doesn’t meet the lender’s qualifications.
Cosigners must meet all lender requirements on their own, and can’t combine their income with yours. This also means that they don’t own the vehicle, but anything that happens on the loan also impacts their credit.
Find a Car Loan in Seattle
Now that you know why a co-borrower could help you get an auto loan in the Emerald City, it’s time to find a dealer that has the proper lending options. At Auto Credit Express, we work with a large network of special finance dealerships in Seattle, Washington State, and across the nation, and we want to help you connect with one near you.
By filling out our fast, free, and easy car loan request form, you can get the process started right now. There’s never any obligation to buy, so what are you waiting for? Get going toward the auto financing you need today!