What Does it Mean to Have a Joint Auto Loan?

Having a joint auto loan is when two people sign a loan contract and agree to share the responsibilities. Joint car loans are typically signed by spouses, who are considered co-borrowers. Having a joint applicant on an auto loan comes with many benefits, but it isn’t easy to remove them if you or the co-borrower decide you no longer want to be on the loan.

Pros to a Joint Applicant Car Loan

What Does it Mean to Have a Joint Auto Loan?Before we dive into the benefits of a co-borrower or joint applicant car loans, know that neither one is the same as a cosigner. Cosigners don’t share rights to the vehicle like co-borrowers, but they’re also equally responsible for making sure the loan gets paid. Their credit is affected just like a co-borrower’s, and the loan is listed on their credit reports, but their name isn’t on the title.

Now that you know the basic difference between the two, we can discuss the benefits to adding a co-borrower to a loan. There are three big pros to having a joint applicant added onto an auto loan:

  1. Can combine incomes – Some primary borrowers just don’t have enough income to qualify on their own, and that’s where a co-borrower can come in handy. Their combined incomes are used to qualify for a loan.
  2. Qualify for a larger loan – You could qualify for a bigger loan than you'd be able to on your own thanks to your co-borrower’s added income. This means you could get a nicer vehicle compared to financing on your own.
  3. Could get a lower interest rate – Finally, if your joint applicant has a better credit score than you, there’s a chance you could qualify for a lower interest rate and potentially save in interest charges if you add them to the loan.

How to Remove a Co-Borrower

Things happen, such as divorce, and you may not want a co-borrower listed on the car loan anymore. Unfortunately, an auto loan is a binding contract, which means you can’t simply remove them. If you want to remove a joint applicant, you have to refinance your current loan.

You need to be able to qualify for the loan by yourself. This means having enough available income, good credit, and equity in the vehicle (owing less than the car’s value).

Need Help Searching for a Dealership?

If you have a co-borrower or a cosigner ready, but don’t know where to look for the right dealership, we’ve got you covered.

At The Car Connection, we match bad credit consumers to dealers in their area that specialize in helping buyers with less than perfect credit. Our service is easy, free, and puts you under no obligation. All you have to do to get the process started is complete our simple and secure auto loan request form.


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