How dare they approve my auto loan!

[Geek King]

And I'm excited that my car (which cost way less that half what hers did) will be paid off next month. And no way am I trading it in for another one. It runs well, gets good gas mileage.

My general rule is that I keep a car until the repairs cost more than the current Blue Book value. I drove my first truck (used) until it was 16 and my recent truck to 13. New cars I get 4-5 year loans covered for the entire loan by origional warranty and/or factory-brand extended warranty, and pay them off early.

Current car- One year-old Nissan Cube.

[Catwoman2965]

Oh WTF is her problem? It's not the BANK'S fault she can't make her payments. People like that make me sick. I'm looking to buy a car next year, hopefuly a new one, as I've never had one, and drive mine into the ground. I'm looking to spend NO MORE than 20K. Which limits me, but is doable. And I know how much I'd like to put down, how much I want to borrow, and for how long, and how much I want and can easily afford to pay per month.

[Gizmo]

We too bought less house (i.e. less pricey) house than we could have. Also I refused to even consider an adjustible mortgage--talk about vindication.
Our vehicles are paid and credit card will be very soon.

I wish that we had the 30/25 year fixes in the UK. We can only fix 5-10 years max and then have to play the game of hoping that rates will be affordable when that ends.

I'd be great for life if i knew I could pay 3-4% for the rest of the mortgage even if it did mean I couldn't pay off in under 15 years.

[Gizmo]

and i'm betting if you DID know that she couldn't afford it and denied her the loan she'd have bitched about that too.

A friend had exactly this. Blamed the 'lack of availability' of lending and how the promises to make stuff this more available was therefore useless. A few weeks later...she then quit the job she'd only had for a month. /facepalm!

[Sapphire Silk]

So, wait, she LIED on the application by stating the co-signer was her husband....then proceeds to piss away her money by giving it to her kids, who are doubtless learning their "budgeting skills" from her; and yet it's your fault that she can't make her payments?

Talk about stupid.

I don't get the impression that she spent the car money on things other than the car. Banks usually inspect the collateral first. When I sold my Dad's car after he passed to a friend of mine, I had to take it to the bank before they would cut my Mom the check.

Rather, I'd imagine she's spending what income she has on her worthless grown children rather than paying down her car.

My general rule is that I keep a car until the repairs cost more than the current Blue Book value. I drove my first truck (used) until it was 16 and my recent truck to 13. New cars I get 4-5 year loans covered for the entire loan by origional warranty and/or factory-brand extended warranty, and pay them off early.

Current car- One year-old Nissan Cube.

Ditto. I had my Honda CRV for 12 years, and 200,000 miles before I bought a new car. I'll have my current car for at least 10 years before I get my next one.

I wish that we had the 30/25 year fixes in the UK. We can only fix 5-10 years max and then have to play the game of hoping that rates will be affordable when that ends.

I'd be great for life if i knew I could pay 3-4% for the rest of the mortgage even if it did mean I couldn't pay off in under 15 years.

We have that in the US because we have Fannie Mae and Freddie Mac: government subsidized but private companies that buy loans from banks for resale on the secondary market as investments. We started this during the Great Depression in order to offer 15 or 30 year fixed mortgages; before that it was a 5 or 10 year loan then a balloon payment that most people couldn't afford. It made home ownership possible for most people for the first time in US history.

[Rapscallion]

Ouch. I remember about two decades working for my father on a window cleaning round. I was doing the inside of one office while the manager of the place was on the phone to a client.

The one bit that made me perk my ears up was when she said, "Can you tell me why you took out a loan you couldn't afford to repay?"

The other thing that really stunned me was about five years ago when looking for a mortgage for the house I now live in. One place, a very notable mortgage lender over here, was willing to offer me five times my income.

Yeah, no way was I going to be able to repay that amount.

Rapscallion

[Ghel]

1) The woman did NOT do the loan on her own. She had a co-signer, who she listed as her spouse (false as it turns out, it was another relative...makes a difference because when a spouse co-signs they tend to expect that they are also paying the loan. When a relative co-signs they tend to expect that they are "guaranteeing" the loan, but that the primary person will be the one paying).

At my bank, we try to impress on the co-signer that if the primary person doesn't pay, they will have to. We usually do this both at application and at closing. But as you say, we wouldn't do this if we thought the co-signer was a spouse.

I'm curious. Has she actually been late on the loan yet, and have past due notices been sent to the co-signer as well? I suppose you wouldn't do that if you thought he was the spouse.

[Raveni]

SC fraudulently filled out loan paperwork. Do you have procedures to catch this kind of fraud, and do you turn them in to the police when you detect it?

[PepperElf]

you know in a way it's like candy and strangers. just because it looks like something nice to take doesn't mean you can afford the consequences of it.

[bankworking]

At my bank, we try to impress on the co-signer that if the primary person doesn't pay, they will have to. We usually do this both at application and at closing. But as you say, we wouldn't do this if we thought the co-signer was a spouse.

I'm curious. Has she actually been late on the loan yet, and have past due notices been sent to the co-signer as well? I suppose you wouldn't do that if you thought he was the spouse.

No, she's not been late on the loan, and likely will not be. She has a joint account with "spouse", who is actually son, and the payments are now coming out from that account. He is apparently taking responsibility for having co-signed the loan. Not stopping her complaints on the matter.

What she has is a bad case of buyer's remorse. Apparently, she decided to try to sell the car and discovered that a 6-month old new car isn't worth nearly what you paid for it, especially when you added on extended warranties and didn't talk the original sticker price down as much as you could have.

This fact is the bank's fault.

[bankworking]

SC fraudulently filled out loan paperwork. Do you have procedures to catch this kind of fraud, and do you turn them in to the police when you detect it?

The co-signer's relationship to the primary applicant has no legal bearing that I know of to a loan's approval or re-payment (except for mortgages, if you live in a dowry state), so there is nothing she signs that states what relationship the co-signer is.

The only reason it really matters is that when someone is sharing the same household expenses, which presumably a spouse would be, then that loan is generally a joint expense anyway, just like income tends to be more of a joint thing (though we still don't let you list your spouse's income if they aren't going to be on the loan). Someone who co-signs just to "help" the first person out, may not really get that they could end up being the one expected to make the payments. (I don't know how many otherwise good credit reports I've seen with one loan in collections, and when I ask why, they answer "oh that was such-and-such person's loan and they stopped paying" as if they have no connection to the bill whatsoever.) For this reason, in the second case, we look a lot harder at whether or not the primary signer can afford the loan on his or her own.

...basically, if we'd known the co-signer was her son, we'd have given her the warning she apparently expected that this was a very large loan for her income.