In certain situations, when your credit is less than ideal based on the guidelines established by your lending institution, you might consider using a co-signer, or someone who can help you finance the automotive loan contract to make up for any shortcomings in your credit history. In essence, a co-signer assumes equal responsibility for your car loan should you fail to make payments or pay off the loan at the end of its term. As a result, this credit account will appear on your co-signers credit report as well.

Exercise caution when asking a third-party to co-sign a loan for you since many times co-signers are required to pay off loan obligations on someone else's behalf in this case, on your behalf in the event you default on the loan.