What's a Cosigner for a Car?

A co-signer is a person – such as a parent, close family member or friend – who pledges to pay back the loan if you do not. This can be a benefit both to you and your lender. ... A co-signer is a person who is obligated to pay back the loan just as you, the borrower, are obligated to pay.

How does a cosigner on a car work?

A co-signer is another person who also accepts full responsibility to pay back a loan. The co-signer is obligated to pay any missed payments and even the full amount of the loan, if the primary borrower doesn't pay. Having a co-signer on your loan gives the lender additional assurance that the loan will be repaid.

Is cosigning a car a good idea?

A cosigner on an auto loan agrees to take full legal responsibility for repaying the loan if you can't pay it back. Having a cosigner for a car gives a lender extra assurances that the loan will be repaid. While a cosigner can help you get an auto loan, they're taking on risk.