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How does a cosigner help me get a car loan?
I applied for a car loan, but the lender said I need a cosigner. I don't really want a cosigner, but I'd rather have the car than not. I just want to know: how does a cosigner help me get a car loan?
Eric Schad · Updated on
Reviewed by Shannon Martin, Licensed Insurance Agent.
That’s a good question! A cosigner isn’t a bad thing: you weren’t outright rejected from the loan; the lender just needed some extra reassurance.
A cosigner assumes legal and financial responsibility for paying a
car loan
. They’re also tied to the credit reporting from that loan, so if you don’t pay, their credit score goes down as well.As a result, they have a vested interest in making sure the loan gets paid on time. This results in a lower interest rate and more favorable terms for the car loan.
Not every person will qualify as a cosigner, but typically those with steady, solid income and a high credit score make the best candidate.
If you decide to go with a cosigner, don’t forget about your car insurance, especially since you’ll need full coverage on a financed car. Shopping around with the
Jerry
app is the best way to get the best deal on the coverage you need: we’ll get you customized quotes from top insurers in seconds, so that all you need to do is pick the plan that works best for you. And once you pick, we’ll even help you switch!Best of luck, and enjoy your new ride!
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- Gregory R.
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Jerry partners with more than 50 insurance companies, but our content is independently researched, written, and fact-checked by our team of editors and agents. We aren’t paid for reviews or other content.
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