     Randall Bigelman (Beigs) | Tuesday, May 30, 2000 - 04:25 pm 
I have been out of the country for quite a few years and basically have little to no credit history. I have moved back to the US and I am in the market to buy a car. If I get my father to cosign a loan for me will I be establishing good credit history for myself if I make payments...basically do the payments show on my credit history or his or both? I can get a loan on my own but not at as good a rate as with my father with his good credit history. Will I be establishing sufficient history if he cosigns the loan? thanks for the help |
| Christine Baker (Admin) | Tuesday, May 30, 2000 - 06:18 pm
I recommend that you get WRITTEN verification of which, if any, credit reporting agencies will be reported to.
Normally the loan will be reported on both your credit files, but not necessarily to all credit bureaus.
Recently there has been a trend NOT to report at all, that's why you want to find out before you get the loan.
Once you got the car loan, get a couple of credit cards, secured if necessary, and again make sure they report to all 3 agencies. |
| Senator (Senator) | Wednesday, May 31, 2000 - 01:49 am
Be prepared for a last minute "revision" to the interest rate--I was told just prior to the signing that the interest rate was to be based on my "FICO" rather than the cosigner. Walk out if you can, if this happens |
| Randall Bigelman (Beigs) | Wednesday, May 31, 2000 - 03:30 am
Another scenario is this...I can get a personal loan for the car from my bank since I have some savings as collateral...the rate is 1/4 over prime at 9.75%. This loan would be in both mine and my wife's name thus assuring that I would establish credit for myself. Should I do this and leave the father out of the equation or wait to see if he can get a better rate?? thanks again |
| John Shimmer (Jshimmer) | Wednesday, May 31, 2000 - 04:41 am
Whether it's your father or your wife, if it's in more than one name, it will be a joint account and listed as such on the credit reports of both people. It does not differ on each report - it does not say "cosignor" on your dad's and "primary" on yours. A cosignor is just as liable for the debt (in the eyes of a lender) as the primary borrower. It's counted as "debt" if he attempts to obtaining financing for something (like a home loan) that is affected in part by a debt to income ratio.
If your dad doesn't mind having it on his report and if he can get a better rate, then certainly go for the best rate.
Regarding your report, building your history and your credit scores, it doesn't matter if it's joint with your father or with your wife or, for the most part, on your own. Just keep it in good standing.
CB: What good does it do to get "WRITTEN VERIFICATION" of which CRA's activity will be reported to? The lender has the right to report to any, all, none or a combination of CRA's, and they can change their mind two days after "WRITTEN VERIFICATION" is sent to you. What are you going to do, sue them because they provided "WRITTEN VERIFICATION" of their current CRA activities and then they change their internal policies and quit or change reporting? What is the purpose of "WRITTEN VERIFICATION" and what good does it do you if they change things? |
| Christine Baker (Admin) | Wednesday, May 31, 2000 - 01:17 pm
It's my position that when a lender states that they will report my account to all 3 CRAs on a monthly basis, and the lender subsequently fails to report, I can sue the lender.
I'll MAKE them report, and they'll pay my legal fees too. Why would a judge rule against me?
When I get a car loan at 9.5% interest for 5 years, the lender can't just change the rate or ANY other terms.
Agree, disagree?
Also, many of the (secured) credit cards issued for (re)establishing credit ADVERTISE their reporting to all 3 CRAs. |
| John Shimmer (Jshimmer) | Monday, June 05, 2000 - 03:13 am
I agree if the issue was a rate increase on a car loan - you've signed a legally binding document that states you'll repay X amount of dollars at Y percentage rate over Z period of time.
I disagree on the success of suing them simply because they don't report you to one (or more) specific CRA's, regardless of whether or not they wrote you a letter about who they happen to report to right now. There is no legal binding contract in which you and the lender have agreed to terms regarding history reporting. Since the FCRA is widely interpreted as they must only report accurate information IF they choose to report and NOT that they HAVE to report, your grounds for suit are pretty much nada. SHOULD you have grounds? Probably. DO you? I highly doubt it.
Since the lender is the one paying the CRA for their services (and unfortunately, we're only the fools who's information they rely upon  ), they reserve the right to choose who to do business with. The judicial system can't force a company to do buisness with a CRA unless they are legally bound (such as a binding contract with you, for instance).
Hard to say regarding the "advertised" quote on reporting. They might be able to force the lender to comply (because it was publically advertised), but not for an infinite amount of time. Otherwise, we could force them to lend us money at the rates they advertised two/five/ten years ago. |
| Shylock (Shylock) | Monday, June 05, 2000 - 04:49 am
I must say I disagree with you and support Christine's position on this matter.
If a company tells you that they'll report to all three major credit bureaus and, by so doing, convince you to get the loan and later on it turns out that they do not then they have committed fraud. I would expect a lawsuit to succeed. |
| Christine Baker (Admin) | Monday, June 05, 2000 - 11:07 am
John, what is the basis for your reasoning?
Why would you say "There is no legal binding contract in which you and the lender have agreed to terms regarding history reporting."
I'd say as soon as I accept the lender's loan, we DO have a legally binding contract, subject to the lenders WRITTEN disclosures including credit reporting provisions.
This is one of those discussions that deserves a CLEAR and FINAL yes or no.
This is a very important issue as more and more lenders stop reporting and especially people who are rebuilding their credit need to ensure that their loans are reported. |
| Scott (Scott) | Monday, June 05, 2000 - 06:28 pm
I think the crux of the matter here is simple:
ALWAYS GET IT IN WRITING! If you get it in writing, then they are breaking the contract if they don't report - insist on it. |
| John Shimmer (Jshimmer) | Thursday, June 15, 2000 - 07:59 am
I'm not disagreeing with the fact that you SHOULD be able to sue them. I'm just saying that I highly doubt that you'd be successful at it.
Sure, you have a legally binding contract if you sign the loan agreement. But if that contract does not specifically state that the "letter" that they mailed (separately, as mentioned previously) to you regarding CRA reporting is PART of the contract, then you're going to have a tough time convincing a judge otherwise. Odds are, the letter wouldn't be much more than something whipped together by some Administrative Assistant who is NOT authorized to sign any legal binding document on the behalf of ABC.
If ABC Loan company is using the services of CRA#1, and six months from now decides that their projected fiscal budget for the next year won't be able to support the costs and fees to continue using CRA#1, then they've got the right to make changes (change to CRA#2 or CRA#3, or quit reporting altogether) UNLESS IT IS SPECIFICALLY STATED AS PART OF YOUR LOAN AGREEMENT.
I just don't believe that a judge rule in your favor. No real need for a basis - it was just a personal opinion. Sorry to ruffle any feathers. |
| Scott (Scott) | Thursday, June 15, 2000 - 10:42 am
I think we all agree here more than we disagree on this. :-) |
| Christine Baker (Admin) | Thursday, June 15, 2000 - 11:53 am
I guess we'll have to find out!
How about this:
"Company xyz agrees to report to all three credit reporting agencies every month the complete and accurate account and payment activity and history including the credit limit as long as the account is active and 7 years thereafter."
What did I forget? Any suggestions?
If the account is in more than one name it should probably specifically mentioned that they will report on all account holders.
I wonder if one could get creditors to sign it.
I'll put $500 towards legal fees to ENFORCE a statement promising credit reporting on the brochure or company letterhead signed by any employees of that company. |
