There are lots of factors that affect an auto loan, including having a cosigner. We’re addressing some of our frequently asked financing questions at Helfman Alfa Romeo of Sugar Land to help you determine the best route for you.
What is Cosigning?
By adding a cosigner, you are adding another individual on your auto loan. However, this is not the same as a joint application. A cosigner is essentially a back-up on your loan. They are contractually obligated to take over your loan if you quit making your payments.
A cosigner is beneficial if you have less-than-ideal or no credit, as their credit can help improve your odds of approval.
What are the Benefits of Refinancing?
If your buying criteria has changed since first getting your auto loan, refinancing may be a beneficial option for you. By refinancing your loan, you may have the ability to secure better terms for your loan if your credit score has raised.
This can help you get a lower car payment since you now have less to finance and may be paying less interest. By paying less interest, you’ll also end up paying less overall.
Does a Cosigner Affect Refinancing?
In short, it depends. If you want to add a cosigner to an existing auto loan, you will be required to refinance it, and you both must be approved individually for the new loan. Similarly, if you want to remove a cosigner from your loan, you must refinance it and qualify on your own.
Thinking refinancing your auto loan may be beneficial? We’d love to help! Reach out to our Alfa Romeo dealership in Houston, TX to discuss your options and get started today!