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Difference Between Co-signer and Joint Applicant?

Tuesday, Aug 12 2008 20:23

Q. What's the difference between a joint car loan and a car loan with a co-signer?

Wes M. - Philadelphia, Pennsylvania

A. A joint car loan is much better than a co-signer. When you co-sign for a loan, you're legally responsible for making the payments if the other person defaults. Even worse, you have no ownership rights to the vehicle, your name is not on the title and you can't sell it if they default or get any insurance payments if it's wrecked, even if you are making the car loan payments.
A joint car loan is better because you would be an equal owner of the vehicle. While you're still responsible for the payments, your name would be on the title and you would have equal rights to the car's use and any insurance money if it’s totaled.

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Confused or unsure about some of the car loan terms used in the article? Click here for our Auto Loan Glossary.




2 comments on this story so far.

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Comment By: Harry Brent on Sat, May 9 2009 at 11:27 AM
The terms are synonymous. Both have the same liability and both can be on the title if both parties consent. Joint just
sounds better than co-signer.
Comment By: Michelle on Tue, Jul 21 2009 at 3:04 PM
How can i sell my car if the co-applicant(soon to be ex husband) is missing and possibly out of the country?

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