February 24, 2010,
N.E. asks from Kaneohe, HI on February 24, 2010
Car Loan and Insurance Questions..
DH and I would like to buy a new vehicle within the next upcoming months and I had a question about taking out a loan. I have good credit, but I am a SAHM. DH on the other hand, his credit score is in the 620s. Possibly lower, but not under 600. To get the best rate, I would like to have my grandma co-sign on the loan, but will they let the loan be in my name if I don't have a job? DH and I are married and he makes more than enough for the both of us. So will they let me take out the loan in my name if I have no job? Or will they allow it because we are married and I can report his income?
Also, for car insurance, I have a clean record (knock on wood lol) and DH's record is absolutely terrible. His license is also suspended due to an accident like 5 years ago. I know he wont be eligible for insurance under his name, so will they allow me to put it under my name even though again, i have no job? I heard that the person who purchases the car has to be the same one to purchase the insurance...
Sorry this is soo long! Please help me out!! Thanks in advance :)
S.R. answers from San Francisco on February 24, 2010
Every institutions policies are different in each of your situations above. I recommend going to your local credit union and talking to a loan rep. If not already a member, you would need to become one and open up a savings to apply/get a loan. Since you have the better credit you need to be the primary on the account and loan. Apply with your husband as coborrower so you can use his income. Most CU's price the rate off of the primary or higher scoring borrower regardless of who has the income. I've seen a lot of loans approved this way over the years. If they won't allow him to be on the loan due to his credit then you would typically need to apply with someone else as a coborrower w/enough income to qualify with debts on your credit report, their credit report, and the new car payment.
In regards to having your grandmother be a cosigner, at most institutions based on your situation you wouldn't qualify. A cosigner gives strength to an applicant but the primary borrower (you) need to have income and qualify for the payment amount on your own. No income means you wouldn't qualify. Typically the cosigner also needs to qualify for the new payments with their current debts. If they don't have enough income to support their bills and yours, then you/they wouldn't qualify. If they were to allow just you and your grandma, she would be on the loan as a cosigner and it would report on her credit report until its paid off. It could affect her future borrowing needs by having the new debt on her credit.
It is true that some insurers require all licensed/of age people living in the home be placed on the policy. Not all do so you will need to call around and ask questions. Also typically all people on title need to be on the insurance, again it depends on the insurance co. I have seen routinely where people have listed spouses or roomates as "excluded drivers" on their policy because they will never drive the vehicle. Check with your credit union to see if they allow this, if they do then you won't have a problem and you will be in compliance with their loan agreement.
Check with your credit union if both you and your husband need to be on the title if not, then just have the dealer put you on title. This will simplify the insurance portion and keep him from any liability on the vehicle.
One last note on not having him on the policy, DO NOT under ANY circumstances allow him to drive the vehicle. You never know what can happen that is out of your/his control. If their is an accident and he is driving the vehicle the insurance company WILL NOT cover any damages and you could end up with a huge suit against you from other parties AND you will still be stuck paying on a loan for a damaged vehicle.
If you have any more questions or need clarification, please let me know.
1 mom found this helpful
S.G. answers from Albuquerque on February 24, 2010
Yes you can get a loan in your name because you are married and your income is shared. As far as the insurance you can also put that in your name. As long as you have income (you or your spouses it should be fine).
Also remember that you have 3 days to go to another loan source and try to get the interest rate down. We have done this with all our cars and have always gotten a better (between 1-3%) rate. In that case it might be wise to check your hubbies credit. If it is 620, maybe get it in his name and try getting the interest rate lowered. This way his credit has a positive account on it and will start to improve.
You could always call a credit union or bank and set up a time to go talk to them and ask them these questions.
A.V. answers from Phoenix on February 24, 2010
I'm sorry but I am not sure what SAHM means. You will not be able to get a loan without a job, If your Grandmother co-signs, she will have to be the primary and you both will have to be on the insurance. Insurance is based on your credit.
If you don't want to use your DH on the loan, you can't use his income. If you do use him on the loan for income purpose, you will end up with a high interest loan.
P.M. answers from Norfolk on February 24, 2010
Ms Nahes, first of all, you can get a loan in your name if you have a co-signer with applicable income. The thing is, if you default on any payments, your grandma gets stuck with it and it will go on not only yours, but your grandma's credit report... In regards to the insurance, you would have to contact insurance companies. They all work differently.. I would call around and find out different options. In all reality though, your husband might have to transfer the title into your name and then you can purchase the insurance, or another option is for him to give you a Power of attorney and you can do it that way.. I think that might cost around $ 50 to $ $100. Hope I have been of some help.. Good luck to ya..
A.S. answers from Davenport on February 24, 2010
You may or may not be able to get a loan since you have no job. It depends on the bank/credit lender with whom you are dealing. You might have to shop around. As for the insurance, every time I have gotten insurance they require that every licensed driver in the household be on the insurance (my husband is an insured driver of my car and I am on his even though we don't drive each other's vehicles) but since your husband has no valid license then they either won't require his name or they just flat out will not insure him.
K.I. answers from Spokane on February 24, 2010
I bet with both your names and you grandma as a co-signer you would get the loan. Husband shows the money, you show the better credit, grandma is on the hook to help. Then car would be in both names, you could get insurance. Insurance companies don't care about jobs...I Don't think? SAHM have cars too!
That is my best guess.
D.N. answers from Chicago on February 24, 2010
You shouldn't have any problem getting the insurance in your name as long as you have a driver's license. However, some insurance companies do require anyone in the household with a license to be on the insurance. A friend of mine has a daughter that had her license for 5 months and the insurance found out. They required the daughter be added to the policy, and this increased the premium big time since she was only 16 at the time. It didn't matter that she would never be driving the car.
W.H. answers from Dallas on February 24, 2010
Hi, if your grandma co-signs the loan-only your name and hers will be on the loan. I believe the only way they would consider your husband's income is if he's on the loan as well. You can be approved for the loan without income only if your grandma's income is enough to cover the loan. You shouldn't have any issues with the insurance in your name.