Ask Stacy: Should I Co-Sign My Fiancee’s Car Loan?

Couple With New Car
Photo by wavebreakmedia / Shutterstock.com

Here’s this week’s question:

My fiancee and I will be getting married in 6 weeks and she is facing some car troubles. Her car has been paid off for over 6 years now, so it isn’t unexpected, and we are looking at buying a car for her.

Given that my car loan is my only debt (not for long), would it be wise for me to apply individually for the credit on her car? Or is there a better alternative with me or her co-signing on the other’s loan (not sure which would be better)?

— Mark

Here’s your answer, Mark!

First, congratulations on your upcoming nuptials! You also deserve kudos for finding someone who’s apparently as thrifty as you are and hopefully also as adept at living beneath their means.

As for your question: I’m sure you’re aware that it’s a bad idea to co-sign other people’s loans. But assuming that you’re absolutely, positively going to tie the knot, what I’d do is approach potential lenders (credit unions may offer you the best deal, although you can also use our loan search to find auto lenders with the best rates) and lay your cards on the table: Ask what interest rate you’d qualify for, as well as the rate your fiancee would be able to get given both of your incomes and credit scores. They can probably give you some guidance without having to formally apply for credit.

Unless you’ve done it recently, it’s a good idea to check your scores before applying for credit. See “How to Get a Free FICO Score” to take a look at yours and learn how to improve it as fast as possible.

In general, the person with the highest score will probably end up getting the best terms, providing they have the credit capacity needed to carry the payments. If you turn out to be the primary borrower, adding her as a co-borrower will help her improve her score as you folks make timely payments on the loan.

But be aware that, should you break up, the loan doesn’t. You’ll be responsible until it’s paid off. So if you cosign the loan, make sure you also co-own the car. For more, see “Ask Stacy: Is It Possible to Get Out of a Co-Signed Loan?

Hope that helps. Best of luck to you and your bride-to-be, Mark!

Got a question you’d like answered?

You can ask a question simply by hitting “reply” to our email newsletter. If you’re not subscribed, fix that right now by clicking here. The questions I’m likeliest to answer are those that will interest other readers. In other words, don’t ask for super-specific advice that applies only to you. And if I don’t get to your question, promise not to hate me. I do my best, but I get a lot more questions than I have time to answer.

About me

I founded Money Talks News in 1991. I’m a CPA, and have also earned licenses in stocks, commodities, options principal, mutual funds, life insurance, securities supervisor and real estate. If you’ve got some time to kill, you can learn more about me here.

Got more money questions? Browse lots more Ask Stacy answers here.

Disclosure: The information you read here is always objective. However, we sometimes receive compensation when you click links within our stories.

Read Next
This Is the Best Online Savings Account for 2021
This Is the Best Online Savings Account for 2021

The rate of return is just one of several reasons this account stands out.

5 Ways to Save at Dollar Tree
5 Ways to Save at Dollar Tree

Yes, it’s possible to pay less than a buck for items from a dollar store.

Why Cutting the Cord Can Be Confusing — and How to Decide If It’s for You
Why Cutting the Cord Can Be Confusing — and How to Decide If It’s for You

Streaming TV might sound like the antidote to sky-high cable bills, but cutting the cord is easier said than done.

3 Cable TV Companies Hiking Prices for 2021
3 Cable TV Companies Hiking Prices for 2021

Still married to your cable company? Hold on to your wallet!

14 Uses for WD-40 That Save Money, Time or Headaches
14 Uses for WD-40 That Save Money, Time or Headaches

WD-40 is handy in a lot more situations than you likely realize.

View this page without ads

Help us produce more money-saving articles and videos by subscribing to a membership.

Get Started

Most Popular
7 Kirkland Signature Items to Avoid at Costco
7 Kirkland Signature Items to Avoid at Costco

Even if it seems you save a bundle buying Costco’s Kirkland Signature brand products, they may not be the bargain they appear to be.

How to Buy Gas At Costco Without a Membership
How to Buy Gas At Costco Without a Membership

The warehouse club often has some of the cheapest gas in town. Here’s how you can get it as a nonmember.

10 Things to Stop Buying If You Want a Clutter-Free Home
10 Things to Stop Buying If You Want a Clutter-Free Home

If you like to keep things simple, avoid these purchases.

If You Find This Thrift Shopping, Buy It
If You Find This Thrift Shopping, Buy It

Vacuums from this brand can last a half-century, if not longer — and they’re hot on the resale market.

A Simple Way to Silence Robocalls Today
A Simple Way to Silence Robocalls Today

A few steps can keep your phone from ringing when a spammer calls.

This Company Makes the Best Tires in America
This Company Makes the Best Tires in America

Driver satisfaction with tires is at an all-time high, but one brand stands out.

Can I Switch to Spousal Social Security Benefits When My Ex Dies?
Can I Switch to Spousal Social Security Benefits When My Ex Dies?

Knowing when to claim can help you maximize benefits.

36 Things That Will Be Obsolete Soon
36 Things That Will Be Obsolete Soon

The writing is on the wall for dozens of things we have grown up with.

8 Things You Should Always Buy on Amazon
8 Things You Should Always Buy on Amazon

The giant retailer shines when it comes to these things, from basics to hard-to-find specialty goods.

This Health Issue Can Hint at Dementia Years in Advance
This Health Issue Can Hint at Dementia Years in Advance

One type of pain is especially associated with cognitive decline.

8 Federal Income Tax Breaks for Homeowners
8 Federal Income Tax Breaks for Homeowners

Some of these deductions and credits are available to a wide swath of homeowners.

3 Ways to Get Microsoft Office for Free
3 Ways to Get Microsoft Office for Free

With a little ingenuity, you can cut Office costs to zero.

17 Surprising Things You Can Sell for Extra Money
17 Surprising Things You Can Sell for Extra Money

You probably don’t realize these items are worth decent cash.

5 Ways to Get Amazon Prime for Free
5 Ways to Get Amazon Prime for Free

Hesitant to drop $119 a year on an Amazon Prime membership? Here’s how to get it for free.

5 Ways to Fill Your Pantry With Free Food
5 Ways to Fill Your Pantry With Free Food

Anyone can take advantage of these resources.

10 Types of Retirement Income That Are Not Taxable
10 Types of Retirement Income That Are Not Taxable

There are lots of things Uncle Sam can’t touch — so long as you play by the rules.

9 Things You’ll Never See at Costco Again
9 Things You’ll Never See at Costco Again

The warehouse store offers an enormous selection, but these products aren’t coming back.

6 Reasons You Should Stop Hiding Cash at Home
6 Reasons You Should Stop Hiding Cash at Home

Stashing money around the house is anything but harmless.

These 5 States Are the Most Expensive Places to Retire
These 5 States Are the Most Expensive Places to Retire

If you expect to have modest retirement income, you may want to avoid spending your golden years here.

View More Articles

View this page without ads

Help us produce more money-saving articles and videos by subscribing to a membership.

Get Started

Add a Comment

Our Policy: We welcome relevant and respectful comments in order to foster healthy and informative discussions. All other comments may be removed. Comments with links are automatically held for moderation.