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Question about financing

boomhower

boomhower

Diamond Member
My wife's car is in my name. She desperately needs a new car. The downside is we are upside down about one or two thousand. If she gets a loan in her name can it be used to pay off the car in my name? Would I need to be a co-applicant. What we want to do is get it down to one car in my name and have one in hers.
 
boomhower said:
My wife's car is in my name. She desperately needs a new car. The downside is we are upside down about one or two thousand. If she gets a loan in her name can it be used to pay off the car in my name? Would I need to be a co-applicant. What we want to do is get it down to one car in my name and have one in hers.
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The simple answer is "yes, you could trade in the car under your name and get a new car financed under just her name". If you're credit is good, it should be no problem. If your credit is sketchy, then a whole big, new forest will open up.
 
Mine is good, her's is a bit sketchy. Mine is just stretched out because everything is in my name due to her shaky credit. We are trying to get a car out of my name because we are looking at getting a house in the next year or two and need to lower my D/E ratio for that to happen.
 
"desperately needs a new car" and "upside down on the current car" = you have bigger financial problems than what your credit needs to look like in a year or two to buy a house.
 
slashbinslashbash said:
"desperately needs a new car" and "upside down on the current car" = you have bigger financial problems than what your credit needs to look like in a year or two to buy a house.
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I was thinking the same thing. How can you be upside down on a car that you desperately need to replace by that much? Is it mechanically failing? How is it that you paid that much for a car that is failing this soon?

How can you afford to make a down payment on a house when you can't pay off a couple grand for a car?

This is very confusing.
 
Magic 8 ball is not optimistic about you buying a house in a year or two given this thread. This is not 2003; now you generally need actual, real money and decent credit.
 
Wife just got out of school and started working full time. Car is failing mechanically, it will often take ten minutes for it to start for no apparent reason. Mechanics have no clue. Have taken it to several and all any of them can do is guess throwing $300 parts at the problem and hope they get it. We owe ~$4k on it and it's probable worth $2k-$2.5k on trade-in. We are starting to put 2K a month towards accumulated debt from when she was in school. In about 6 months we should be debt free minus the cars. Another year and we will have plenty for a down payment on the size of house we will be looking for(~$80k). The house will be only in my name since I do have decent credit, just need to get a car out of my name.
 
Did you ever start a thread for help with the car here?

If not post the year, make, model and engine size and what problems you are having. Maybe someone here ahs had the same issue and others, like myself, were/are auto techs.

A no start problem is usually easy to find and trace. Much better then the it stops when driving every other week type thing.
 
You or your wife can get a personal loan to pay off the balance owed on the auto loan in your name if you have an immediate need to get the auto loan off your credit report, but personal loans are unsecured and usually have pretty high rates (credit card type rates) putting the loan in your wife's name with "sketchy" credit will only push the rate higher. Or you can finance the amount owed on the old car through the loan for the new vehicle at a little better rate and only have one loan on your credit report.

Good for you for having a plan to pay off your debt quickly and making it a priority. Unfortunately when it comes to buying a house, unless your income is fairly substantial or your down payment is fairly substantial, you'll need to include your wife's combined income to qualify for a home loan, which means her credit history will affect your eligibility and rates. I assume since you call your significant other a wife it means you are married, quit thinking about your credit score or hers and just do whatever is best for the family, get the lowest rates you can and put both names on the loan if needed, after a few years your credit scores will be nearly identical.
 
kornphlake said:
You or your wife can get a personal loan to pay off the balance owed on the auto loan in your name if you have an immediate need to get the auto loan off your credit report, but personal loans are unsecured and usually have pretty high rates (credit card type rates) putting the loan in your wife's name with "sketchy" credit will only push the rate higher. Or you can finance the amount owed on the old car through the loan for the new vehicle at a little better rate and only have one loan on your credit report.
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I still have my car in my name and it's not going away anytime soon, just got it last year. We know the rate is going to be higher but I don't see any other way.


Good for you for having a plan to pay off your debt quickly and making it a priority. Unfortunately when it comes to buying a house, unless your income is fairly substantial or your down payment is fairly substantial, you'll need to include your wife's combined income to qualify for a home loan, which means her credit history will affect your eligibility and rates. I assume since you call your significant other a wife it means you are married, quit thinking about your credit score or hers and just do whatever is best for the family, get the lowest rates you can and put both names on the loan if needed, after a few years your credit scores will be nearly identical.
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Their is no way she is going to be on the loan. Even if we could get a mortgage with her name on it the rate would be sky high. That is the reason for planning for a 20k down payment on an 80k house, no my income is not substantial and is frankly piss poor but I love my job. I really wish she could be so we could include her income.(Nurse vs. cop, yeah she makes more) With her credit I just don't see a way. When the time comes we'll revisit it and hope some of the worst stuff falls off.
 
I don't see how someone struggling with what amounts to a $4k debt is looking to save $20k for a house in a year.
 
boomhower said:
Reading comprehension FTW. More than doubling household income definitely helps, shooting for more like 1.5-2yrs.
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Personal finance FTW. If it's really just a month or two before you turn things around, why not make do with the cars you've got until then? Share rides with co-workers, drive each other to work, etc..... And then, once you've got a little saved up, maybe buy a $2000 beater instead of going $15k+ into debt for a rapidly depreciating piece of metal and plastic?
 
alkemyst said:
I don't see how someone struggling with what amounts to a $4k debt is looking to save $20k for a house in a year.
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Yeah, the math doesn't add up.

IMHO the OP will be better off fixing the current car. Even if it costs over $1000 to fix it he'll spend significantly less money than replacing the car.

People routinely say that an older car got too expensive to maintain so they went and got a new car. Paying $20k to fix a $1k or $2k problem because its 'too expensive' is insane.
 
slashbinslashbash said:
Personal finance FTW. If it's really just a month or two before you turn things around, why not make do with the cars you've got until then? Share rides with co-workers, drive each other to work, etc..... And then, once you've got a little saved up, maybe buy a $2000 beater instead of going $15k+ into debt for a rapidly depreciating piece of metal and plastic?
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If I told my wife she was getting a $2k beater I would be divorced in short order. And no, she can't drive my car because it's a manual.
 
boomhower said:
If I told my wife she was getting a $2k beater I would be divorced in short order. And no, she can't drive my car because it's a manual.
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Again... bigger issues underlying this whole thing, that won't go away if you just sweep it under the rug and go into MORE debt and buy a new car.

#1 being, your wife doesn't understand she's (or, rather, you're both, collectively) in a shit-ton of debt right now and can't afford to have a brand-new car. There is such a thing as "not being able to afford something." No, you're not entitled to a brand-new car just because you have a job.

#2 being, you can't take a few hours and teach your wife to drive a stick? Or she refuses because...?

#3 being, your wife is ALREADY driving a $2k beater. If she doesn't understand that, then you should make her understand it.

Sorry for being the asshole who points out reality to you. All the other posters in this thread agree: you can't afford it, and these numbers aren't adding up. You can't escape reality forever, brother. The sooner you can fix these denial issues, the better off your marriage will be.
 
boomhower said:
Their is no way she is going to be on the loan. Even if we could get a mortgage with her name on it the rate would be sky high. That is the reason for planning for a 20k down payment on an 80k house, no my income is not substantial and is frankly piss poor but I love my job. I really wish she could be so we could include her income.(Nurse vs. cop, yeah she makes more) With her credit I just don't see a way. When the time comes we'll revisit it and hope some of the worst stuff falls off.
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Both my wife and I have great credit scores, when we went to apply for a mortgage I expected that my credit score would be used for the loan calculation since my wife is a stay at home mom and she hadn't had any credit cards or loans in her name for about 7 years. The mortgage broker showed us our credit reports and my wife's score was about 20 pts higher than mine, although it didn't make any difference in the rate, he used her score on the application. He then asked how long we'd been married and said it's pretty typical when a couple has been married for several years their credit scores align within a few points regardless of who has the greater income or who has their name on the debt.

Apply for a loan together and see what happens, you might be surprised.
 
I'm of mind that if you owe more than what your car is worth, it will generally cost you less to keep the car and maintain it than to lose money selling/trading it for another car that will have its own problems. there are only so many things that can prevent the car from starting.. If that's the only real issue, it's definitely a better idea to keep the car.

The money you save by keeping the car will help you save towards the down payment. A car is almost always a depreciating hunk of junk on wheels, so you want to spend as little as possible in the grand scheme of things; unless you have money to throw away or are passionate about cars as a past-time or hobby., or whatever.
 
The short version of my advice is: get it fixed. Now, here's my tale of adding a second income to a family's budget and what happens to the money:


Doubling household income may not yield as much as you think. Some of these (but maybe not all) new expenses may be introduced to your budget:

1. Extra commuting expenses (which you are getting ready to face now)
2. Daycare
3. Saving for retirement (you are probably gonna have to play catchup)
4. School loans
5. paying down short term / high interest debts
6. cost of conveniences related to being away from home more
7. Increased income taxes (you are gonna get hammered on these, but it is a relatively good problem to have)
8. random insurance coverage, e.g. short term disability, etc.

Believe me, I added an electrical engineer's entry level salary to my household income in late 2008 and we have managed to pay down:

~$5K in CC debt (that was all)
~$6.5K in school loan debt (4.5K remain)
~$11K auto loan (done)

And we also have saved:

$10K min in checking at all times (was less than $200 when I received my first paycheck, wife was on maternity leave - our only child so far)
~$12K contribution to 401(k) + more for company contributions

And the rest just seems to have disappeared: daycare adds ~350/month, commuting expenses ~220/month (loooong commute for me), utilities have gone up a lot, etc. Added ~$30/month for better satellite tv service. Baby expenses, too.

It really doesn't look like we have done well at all considering I've been "paid" ~75K since 2008. I can estimate about 45K in real increase in assets (contributions only, this doesn't count performance) and decrease in debt.

All this in mind, if you have been doing back of the envelope calculations about your financial outlook, you may want to act as if the added income is reduced by half and proceed from there.

p.s. we have not taken any expensive trips (staycation for us), I did chip in $600 to get MiL an iMac for helping with daycare, but no new computer for us. We go out to eat 1x per week, expense is typically $25 each time.
 
rdp6...you seem to have a solid base. $10k in the bank liquid is a major advantage. Being debt free another.

Expenses are something that comes with whatever territory. Daycare is one thing I am glad I can avoid. No kids for my wife and I...however, having 4 cats and dog isn't exactly cheap. 🙂

I am currently sending $2k or more to old credit debt...it was at over $80k and now I am down to the last $15k (was 10k but april and may brought $5k in medical, car, pet and home expenses).

Once I have that out that $2k is going to a savings account until I have at least 6 months savings. Then I am splitting that into more savings and additional 401k/retirement savings.
 
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