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Can Car Finance Be In Joint Names?

Can Car Finance Be In Joint Names?

If you and your spouse are considering sharing a car, you may be wondering: can car finance be in joint names?

The answer is yes — you and your spouse or another person can borrow a joint loan that would be under both of your names. However, before filling out a joint application, you’ll want to ensure that you fully understand these loans and their potential consequences.

Read on to learn more about joint auto loans, then contact our team at Westside Auto Wholesale to discuss your financing options.

Can Car Loans Be In Joint Names?

If you and another person are looking to share a vehicle, you can often sign the auto loan in both of your names. While not every lender offers joint loans, many allow you to share the responsibility of the loan with another person.

Joint loans are commonplace for major purchases, such as cars and houses. Many people cannot afford these major expenses independently, leading them to split the cost with another person — typically a spouse or a close family member.

How Do Joint Loans Work?

In a joint loan, you and the borrower are both responsible for the entire loan amount. This does not mean that you will need to pay double the borrowed amount. Instead, if both of you fail to repay the loan, the lender could seek out either one of you to pay the remaining balance.

For instance, let’s say you and your spouse borrow a $10,000 joint auto loan with a $200 monthly payment. If you’d like to split the loan evenly, you can each send in $100 per month

In joint loans, you and the co-borrower will both be responsible for the loan throughout its duration unless you change the loan terms with the lender. This means that if you and your spouse decide to make the car “yours” down the line, your spouse will still be listed on the loan.

Of course, you can send in the total loan payment yourself without involving the co-borrower. However, if you default on the loan, the co-borrower may be held responsible for your failure to pay.

Reasons to Finance a Car in Joint Names

Filling out a joint car finance application can be beneficial for several reasons. Here are a few reasons people choose to borrow joint loans for car purchases:

Make a Shared Purchase

One of the most popular reasons to take out a joint auto loan is to split the financial responsibility of the vehicle. When you apply for a joint loan with another person, you’ll both be responsible for the loan payments, allowing you to both contribute to paying off the loan and owning the car.

It may not be wise to apply for a joint loan with someone if you do not both have something to gain from the loan. For example, you may have trouble convincing your friend to borrow a joint loan for a car that will be solely yours.

However, when you and the co-borrower will both gain something from the loan, a joint loan can provide an effective means to share a major purchase.

Secure a Larger Loan Amount

Applying for a joint loan may allow you to secure a larger loan amount than you could independently. Because you and your co-borrower will both contribute to the loan payments, the lender may feel confident loaning you more money. As such, you may be able to secure a more expensive vehicle through your joint loan.

However, just because you can qualify for a larger loan amount through a joint loan doesn’t mean you should seek the highest amount possible. You and the co-borrower should review your financial situations carefully to determine a loan amount and monthly payment that suits your budget.

Improve Loan Eligibility

Joint loans typically have more generous eligibility requirements than single personal loans. This is because if the borrowers fail to pay, lenders can attempt to receive the loan payment from two people rather than trying to track down a single borrower.

However, even though eligibility terms for joint loans may be more generous, you and the other borrower will both need to meet these terms. As a result, if you have a bad credit score, you can’t rely on the co-borrower to improve your eligibility.


Joint Loans vs. Cosigner Loans

Many people confuse joint loans with cosigner loans. While you can use these loans for the same purposes, they have different application processes and terms.

Typically, both applicants of joint loans need to have a good enough credit rating to qualify for the loan independently. However, applying for the loan together may provide special discounts and ensures that both parties are responsible for the loan payments.

Meanwhile, borrowers sometimes apply for cosigner loans if they cannot qualify for a loan independently. In these cases, the borrower would ask someone close to them, such as a family member or friend, to cosign the loan application. If the borrower failed to repay the loan, the responsibility would fall to the cosigner.

The main distinguisher between cosigner loans and joint loans is the primary payment responsibility. In cosigner loans, the primary borrower is responsible for the loan payments each month. If they fail to repay the loan, the cosigner would then need to make payments.

Meanwhile, in joint loans, both parties are equally responsible for the loan payments.

If you and another person would like to finance a car together, we recommend registering the vehicle in both of your names. You’ll both need to go to the MVR and bring proof of identification to register the car initially. Then, only one of you will need to attend the MVR for future transactions.

At Westside Auto Wholesale, we make the process of joint financing simple. Contact us today to learn more about our joint financing options and review our current vehicle inventory.


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