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My Loan Co-Signer has Died – Will I lose my car to the estate?
In order to be approved for credit, about 10% of borrowers in Canada need to give the lending company (usually a bank) assurance in the form of a co-signer. A co-signer is someone who has a good and established credit rating already, and who agrees to assume the debt in the event that the person in whose name the money is lent is unable to pay.
In many cases, the co-signer of a loan is a member of the borrowers family; most other people will not assume the risk, although it could be a close personal friend with a good credit record. In some cases, there is a risk that a co-signer may die before the loan is fully paid back, in which case the borrower may wonder what will happen to the assets purchased with the loan. In this scenario, we will use the example of a car in order to see how the situation will play out.
First of all, it is very important to note one thing; the co-signer of your loan does not, in fact, own the car that you needed to obtain the loan to buy. They are simply a guarantee to the lending company that someone will be able to pay for the car. Ownership will only revert to them if you have defaulted on the loan on your own, and they have had to make the payments themselves. In this case, the paper work will already have been changed to reflect the co-signer as the owner. In this case, you car will be part of the co-signers estate, but otherwise it is your own property.
Of course, the death of the co-signer does lead to other issues, even though the car will still be yours. Probably most significantly, you may have to report to the lending company that you no longer have a co-signer to cover you in case of default. Now, the odds are that if you are a responsible enough person to do this in the first place, you have been sure to make your payments. In that case you should have no problems; heres why.
Remember that the reason you had to have a co-signer in the first place was due to bad or no credit (probably no credit record). Once you have been making payments on a loan, however, you have established a credit record. Lending companies now have a basis on which to approve you for a loan, so you will probably be able to secure the loan without the need of a co-signer.
Of course, most people will probably not even think of informing the lending company should a co-signer die; as long as you continue to make your payments, this will not be an issue. If you do default, though, and the co-signer is responsible, your car will become part of the estate.
Online lenders: The source of fast unsecured loans
If you are a tenant or a homeowner who do not wish to use home equity for borrowing some money, then unsecured loans can be an affordable way to avail it. Whatever may be your purpose – refurnishing your apartment, buying a big-screen plasma TV, putting a built-in barbecue in the backyard or doing anything else of this sort, this type of loan will be an ideal choice to finance it.
The amount you can borrow with unsecured loans is determined by your credit record. A good credit record will allow you borrow big amount and vice-versa. Basically, it is a short-term loan and hence not-so-big an amount is offered through it. Yet, in exceptional cases, big loan amount is sanctioned. But the loan term does not extend over a longer time. So, the borrower needs to pay off the money in relatively bigger instalments.
This particular loan product is processed rather quickly. In fact, it is secured by the signature of the borrower. This indicates that the loan involves no lengthy documentation. Hence, fast unsecured loan caters to the need of quick cash delivery. It also gives the borrower relief from the tedium of paperwork. In some cases, the borrower gets the chance of saving the property assessment cost.
Nowadays, online lenders offer various deals on unsecured loans. These lenders are accessible via the Internet. This means that one can exchange information with them from anywhere if he has access to the Internet. One can compare loan packages offered by different lenders simply over the website of a particular lender. Taking quotes, comparing APR, reading the small details & 9472; all this can become quite easy.
Another important benefit of online unsecured loan is that you do not require meeting the lenders physically on different occasions. You have to meet him only at the later stages of the loan process. Thus, much of the hassles involved in taking out loans from high-street lenders will not be there.