Too Much Of A Risk!

Mel Hambelton Ford, Co-Sign, Not Buy

Last week, a friend of ours asked if we could co-sign for a car loan, which I was non-committal about, I said I would meet with her the next day at the dealership, Mel Hambelton Ford. But we never got that far, as my wife decided to go out to the dealership, with our friend, to pick out a car the same evening.

From there, things escalated quickly, it got to the point of having run my wife’s and our friend’s credit, our friends have poor credit, the wife and I have excellent credit, in the high 700’s. The deal was progressing rapidly, to the point of signing on the dotted line, when my wife, stopped and asked, why is our friend not signing anything, that’s when the bombshell dropped, that we’d be buying the car, not just co-signing.

Thankfully, my wife called me to explain and that was where I said “absolutely not”, there is a significant risk with being a co-signer, let alone buying a car, being responsible for registration and insurance. Friend or not, I am not willing to jeopardize my family’s financial security. We have loaned these friends money before, and, they did pay us back, but not at the agreed time, leaving us hanging for two added weeks.

Since that evening, I have found out more information about our friend’s financial situation, which, to say the least, is not healthy. I’d like to help them out, but buying a third car, relying on them to make the payments on time, reimbursing us for registration and car insurance costs, is too much of a risk, we are not that financially wealthy to be able to make another $350 payment, plus insurance and registration.

I’m especially annoyed with Mel Hambelton Ford, while talking to their finance guy on the phone, I mentioned the term ‘co-sign’ numerous times, and not once did he clarify that we would be buying the car. He later apologized to my wife and our friend for not making this clear. But I have my own opinion on this; the dealership wanted the sale, and were going to do whatever they had to do to secure that sale.

2 thoughts on “Too Much Of A Risk!

  • James Millard commented on May 19, 2019 at 14:29

    Sounds like you narrowly missed being on Judge Judy and taking your friends to small claims court in a year or two.

    There is a reason why your friends have poor credit and that’s not something to be ashamed of necessarily, but why do people insist on getting cars on credit? It seems incredibly popular in the US but increasingly so in the UK. Why not just buy an older second hand car with a reliable record for 2-4 thousand (or whatever you can afford) and pay no interest?

  • James, not everyone has $2-4k to spend on a car in cash, even buying a cheap car, requires people all over the world to finance their vehicles, and that is fine if you can afford it, unfortunately, sometimes predatory loan companies and dealers cash in on the desperation of low-income people to be able to buy a vehicle, forcing 29.9% interest rates on people. Unlike the UK, public transport is exceptionally limited in much of the USA and people need a vehicle to get to and from work, you might not have experienced this as a non-car owner, but many people have to pay the financing penalty, even myself. My used Ford Fusion, initially, when I had zero credit, my interest rate was 18% and a $511/month payment, before refinancing a year later when I had built my credit up. This post was never meant to be an attack on our friends, it was about myself and my family’s financial security.

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