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If you’re in the market for a new or used car, you may be wondering if you need a co-borrower on your car loan. Unfortunately, this can be difficult to answer, depending on your circumstances. In this article, we’ll take a look at some of the factors that go into making this decision, and we’ll provide some tips on how to remove someone from a car loan if necessary. Keep reading for more information!

What is a co-borrower?

A co-borrower is a person who is part of a joint auto loan contract that shares equal responsibility for the repayment of a car loan. If you consider taking out a car loan, it is essential to understand how having a co-borrower can impact your new loan.

How can a co-borrower help you qualify for a loan?

One of the primary ways a co-borrower can help you qualify for a car loan is by adding their income to yours. This can help you meet the minimum income requirements set by lenders. Additionally, a co-borrower can help you receive a lower interest rate on your loan.

Do I need a co-borrower on my car loan?

No, you do not need a co-borrower on your car loan. You may choose to have one, but it is not required. If you do choose to have a co-borrower, they will be equally responsible for the auto loan payments along with you. Your names will appear on the title and loan documents and your credit reports.

If you are thinking about getting a co-borrower for your car loan, it is essential to consider all of the potential benefits and any risks.

Benefits and drawbacks of having a co-borrower in an auto loan

When you’re buying a car, you may choose to have a co-borrower on your loan. This is someone who will share legal responsibility for the loan with you. However, you should be aware of some benefits and drawbacks to having a co-borrower before making your decision.


  • Reduce your auto loan’s overall cost by splitting the monthly payments between multiple parties.
  • Having a co-borrower can help you qualify for lower interest rates since various income streams are considered when applying for a loan.
  • If co-borrowers have a better credit score and credit history, this can be helpful in securing a loan for a newer vehicle.


  • You may be responsible for making payments even if your co-borrower misses them. This could damage your credit and your relationship with the cosigner.
  • If you default on the loan, your co-borrower’s credit score will also be impacted.
  • You may have to get co-borrower’s permission from your co-borrower before making changes to the auto loans, such as refinancing or selling the car.

Can a cosigner get off a car loan?

It’s not uncommon for people to ask this kind of question when considering taking out a car loan. After all, a cosigner essentially agrees to be responsible for the loan if the primary borrower can’t make the payments. So it stands to reason that you might be wondering if there’s any way to get rid of a cosigner on a car loan.

How to get out of a car loan contract?

The standard option for getting out of a co-owning a car contract is by having a co-borrower or cosigner removed from the loan. This can typically be done by contacting your lender directly and requesting that the cosigner be released from the loan agreement.

Can you remove a name from a car loan?

You can’t just remove your name from a vehicle loan if you’re a co-borrower and not the cosigner. So the only way to clear out of yourself in this scenario is to refinance the car loan.

Steps on how to remove name from car loan

If you’re the primary borrower on a car loan, you may be able to remove a cosigner or co-borrower from your loan. This can be advantageous if you want to refinance your loan or sell your car. Here are a few ways to remove someone from a car loan:

1. Pay off your loan: The simplest way to remove a cosigner or co-borrower from your loan is to pay off the balance of your loan in full. Once the loan is paid off, you’ll be the sole owner of the vehicle and can do what you please with it.

2. Refinance your loan: If you have good credit scores, you may be able to refinance your car loan, which can help you get a loan approval without a co-borrower.

3. Sell your car: You may be able to sell your car and pay off the loan balance with the proceeds. This can be a good choice if you’re struggling to make your monthly payments or if you want to get out of your loan contract.

Frequently Asked Questions

Is it better to have a co-borrower on an auto loan?

If you need assistance in meeting credit score criteria, a cosigner is likely to be beneficial. Cosigners lend their excellent credit score to assist you in meeting lender standards and lower your risk of default by promising to repay the loan if you can’t. But keep in your mind that it may take some time to remove co-buyer from car loan agreement.

Does it matter who is primary on a car loan?

The cosigner of an auto loan is legally responsible for fulfilling the financial obligation of the loan if the primary borrower crash to make on-time payments, and if the primary borrower defaults on the loan, their credit ratings will be harmed.

Should you add a co-applicant for a car loan?

A co-applicant may help you get approved and qualify for a larger financing amount or a better interest rate by adding value to your credit application in a variety of ways. They might allow you to be accepted, qualify for a greater funding sum, or obtain a higher interest rate.

How to take my name off a car lease?

You can ask the lender to release you from the loan contract. In order to do this, the borrower will need to have made all of their payments on time and in full up to that point. The lender may also require a new cosigner or co-borrower before they will agree to release you from the car loan.

How to remove your name off a car title?

Simply sign your name over to the individual or organization you wish to give your automobile to on the back of the title. Make sure that any title transfer is classified as a sale, with you being the seller and the other person or body receiving the car.

Final Thoughts

If you are considering taking out a car loan, it is essential to understand the role that a co-borrower or cosigner plays in the process. Typically, a co-borrower or cosigner will be someone who has an established credit history and sufficient income to qualify for the loan on their own.

At the end of the day, whether or not you need a co-borrower on a car loan will depend mainly on your own financial situation and credit history. If you are confident in your ability to repay the loan on your own, then you may not need a cosigner. Although, if you are concerned about your ability to qualify for a car loan on your own, then it may be wise to have another person cosign the loan with you.

Ultimately, the decision about whether or not you need a co-borrower on a car loan comes down to your own personal circumstances.