How Many Auto Loans Can You Have in Your Name at Once?
Q: I was told that I was approved for a car but couldn’t get the loan because both my fiancé and I currently have a car loan at the same time, and it’s in both of our names. They said I won’t be able to get another car until the loan is paid off. So I’m wondering is it against the law to have more than one auto loan out? And will I be able to just get a loan from a bank instead, seeing as the dealer told me if it weren’t for both of us being on the current loan, we could’ve gotten the car? Kimberly – Chazy, N.Y.
A: No, it is not against the law to own several cars, boats, homes, etc. in your name(s). But, all lenders have their own policies or guidelines in lowering the risk of their loan portfolios. When it comes to financing, the better the credit rating you have, the better options you have to use your credit, especially in auto financing. Do you know if your credit rating is considered prime or sub-prime?
Sub-prime lender guidelines permit one open auto loan per spouse, so trade one of your vehicles in and make sure that the dealer relays that information to the lender. If your credit rating is superb and that is not the issue, then it has to do with your debt-to-income ratio being over their lending guidelines. Again, you may have to trade-in one of your current vehicles. Additional note: Buying a vehicle and gifting it to someone else is not permitted if it is being financed (technically the vehicle is not completely yours to give away). Straw purchases are another topic.
Agustin Vasquez, Jr. –
General Manager, Mack Massey Chrysler Jeep Dodge