Post # 1
So FI’s car is a piece of crap and it finally died today, wouldn’t start at all. It’s been such a mess this past year that it’s not even worth trying to fix it. Well he’s missed two credit card payments and his credit score is 648. Mine is 803 and I’ve never missed a payment on my credit card and have tried to limit how much I use it.
Well he’s asking me to be the borrower for the loan or at least be a cosigner and I honestly don’t feel comfortable with that. I trust him to pay but not on time and I don’t want my credit score taking a hit. On the other hand, the difference between the rate I was offered (4%) and the rate he was offered (13%) means a 100 diff in monthly payments. And I’d have to pay that $100 by taking on more of his bills.
I am so angry and frustrated and I don’t know where to go from here. We’re getting married in a month and I know that as a husband/wife team we should take these things together but its so hard to put into practice.
Post # 3
You know what? If it was me, and if his credit rating was due to being frivolous and not external problems (such as, lost his job suddenly and couldn’t make a couple of payments) then there would be absolutely no chance I would take on something in my name that is for my partner to pay off. It doesn’t matter how much I love him… because I would not expect to have that done for me in return.
If you are desperate and the loan is for a cheap car to get from A to B for under $4,000 or something, then I would probably consider it! But we don’t HAVE to have expensive cars, and if it were me (and my car is worth about $2,000 but I bought smart) then I would look into public transport for the time being.
Please just protect yourself. I had a friend who would take her partner’s speeding demerit points (not sure what country you are in) at the risk of losing her license. I think that’s being pretty silly and not looking after yourself……
Post # 4
My condolences to you though, it sounds like a really tricky situation, because it’s almost like being blackmailed into signing so that you don’t have to somehow pay the extra $100! Perhaps suggest that you will give him $30 per month out of that hundred if he just takes it on himself? Hmmm! Not sure what to suggest! Any help from parents perhaps?
Post # 5
If it were me and it’s your FI not your random boyfriend, I’d do it. I cosigned on DHs car loan right after we got married because it significantly reduced his interest rate and therefore his payments. I would have done the same while we were engaged. It didn’t affect my credit score that much to just have an additional loan; assuming its always paid on time, it can actually be good for your score to have a variety of different credit types.
ETA: However, if he has missed payments in the past, you need to have a serious conversation about financial responsibility etc before you get married. That’s a BIG thing, and a major cause of marital issues/divorces.
Post # 6
@CrazyCatLady13: Nope. If his poor credit rating is due to his own carelessness than you would be really foolish to give him the power to ruin yours as well. It always amazes me that adults who can’t manage their own money/credit have the nerve to ask those who CAN to trust them/bail them out/risk their own credit. Nope, nope, nope – all day long.
Find another solution that doesnt involve sacrifice or risk on your part, but on HIS. If he has to get a loan with a higher interest rate let HIM figure out how to come up with the extra $100. maybe then he’ll make an effort not to screw up his credit in the future.
Post # 7
If you do co-sign with him, is there any way you can ensure that they payments get paid on time?
I know it must be very frustrating to have to monitor what is essentially his responsibility, but it might be a solution in this situation so you’re not $100 out of pocket and won’t risk ruining your own credit score.
Since you’re engaged, it could possibly help him understand how to manage his payments better, helping you both out in the long run.
Post # 8
Get a less expensive car for him. He needs to learn the consequences of being irresponsible with money now, before he has a chance to jeopordize the big joint purchases and investments you’ll make as a married couple.
Post # 9
If you’re getting married in a month I’d probably do it, but I would be in charge of setting up the payments.
Post # 10
FI has a friend who co-signed a loan with his girlfriend (a little bit different, I know) and once they broke up he couldn’t legally get out of paying for her car (he tried).
If she falls behind on her payments HIS credit will suffer!
My vote is don’t cosign and let FI learn his higher-APR lesson, impending marriage or no.
Your credit will be tarnished if he misses a payment on this car.
Also, I don’t know what kind of car he’s buying, but if he can afford a less expensive car with cash (even if it’s not the newest, bestest car) he should do that instead. If he can’t be responsible for his finances, you shouldn’t be responsible to pick up his financial slack if he wants a shiny new car. I vote buy used – if he saves up enough cash he can buy a better car ina few years.
And at least make the highest down payment he can, so he can take out a smaller loan (by himself).
A car loan can improve his credit quickly, but only if he pays it off on time. :/
I’m really sorry you have to deal with this, OP.
Post # 11
@CrazyCatLady13: I would cosign, but have him set up an automatic payment plan through his bank so you know the loan is being paid off every month on time. Maybe you should have access to his bank account as well so you can make sure it is set up and actually see if it’s being paid on time every month. This is probably a good time to have a talk with him about finances as well so you know how you guys will handle these situations when you’re married.
Post # 12
Once you get married and start adding each other to any existing accounts, his credit issues are going to drag your credit score down, and your good credit is going to raise his score up. So if you are not prepared to see your score go down, don’t ever take out a joint credit card or loan or even add him to one of your existing accounts as an authorized user, and don’t let him add you as an authorized user to his.
Whatever you do here is going to set the tone for how you manage your finances together in the future. The PP who suggested buying a cheaper car is spot-on; this is probably the best compromise, and while you will probably still need to take out a loan to do it, the lower amount to finance means lower payments to him if he has a higher APR.
Post # 13
I think that’s pretty crappy that you won’t co-sign for the man who is going to be your husband. I would almost be re-considering if my DH said something like that to me. You are supposed to be on his team – not judging him for missing two payments.
Post # 14
@CrazyCatLady13: I wouls say cosign since it will benefit both of you but be in charge of the payments and make sure theyre always on time. Consider it one of your bills but it will be paid with his money.
Post # 15
How recent were the late payments?
I have some late payments from five years ago still dragging my score down. Negative credit things don’t go away for 7-10 years.
Post # 16
This is tricky. I would just straight up tell him, “Look honey, I love you, but considering your history of paying your credit card off late because you forget, I’m not comfortable cosigning for your loan. I need you to understand that if I did cosign and you forgot payments like in the past, my credit score would be negatively affected.”
Also, he can tell you all he wants that he wont miss a payment, but even the most responsible people in the world can’t make that promise. Considering that it’s happened in the past multiple times, you have reason to be concerned.
I’m in the camp of never cosigning for anyone else’s loan ever. Theres just too much casual power that another person has over something so important for you.
I agree with others, encourage him to look for a used car. He doesn’t need a brand new shiney car, especially if he only needs it for getting to and from work. I don’t really understand why *anyone* buys a brand new car, actually lol