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Posted in Auto Loans
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Question By
MCHubbard2

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Effects of cosigning an auto loan and then trying to purchase/lease another within a month or two?
If I were to cosign on an auto loan of about $30,000 now, do you think I can apply for another auto loan or lease of about $40,000 within the next month or so? What is the likely hood of the second vehicle purchase/lease happening?

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A lot depends on your income and credit history. Think twice about co-signing, which is needed if the original borrower does not have adequate credit history to obtain a loan without a guarantee that the loan would be paid as agreed.  Can you afford to pay that loan in addition to others you may have, or wish to have?  .Personally, I do not co-sign.  If they want it bad enough, they'll work on their own credit so they can get it.

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It will mainly be a "debt to income ratio" determination. Can you afford both loan payments in addition to your other payments? The banks will want to see that you can. Cosigning any loan is usually a very bad idea, especially a thirty thousand dollar one unless you are super wealthy and it wouldn't hurt your finances to pay the thirty grand in event of the other person not paying. A thirty thousand dollar vehicle is a want, not a need.

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