Keep in mind that a cosigner can't take possession of a car they've cosigned for. A cosigner doesn't have any legal rights to the vehicle, so they can't take a car from its rightful owner, the primary borrower.
Unlike co-borrowers, who are on the title or have some claim to the property or funds, co-signers have no title or ownership of the property the funds are used for. For example, a co-signer for a vehicle has no legal right to the financed vehicle.
But most states allow cosigners to take primary borrowers to court in the following situations: Cross claims: If you default on or fail to repay the loan, the lender could sue the cosigner for the money owed. The cosigner may then be able to sue you for the money that the lender is trying to recover.
Request release from a co-signed loan
Co-signers can make a written request to the lender to be released from a loan. In certain cases, like some student loans, there may be a provision that allows a co-signer to take their name off a loan.
Cosigner: This is a person with solid credit and income who can help boost your chances of approval. Although liable for payments if you default, the cosigner doesn't share vehicle ownership and won't be on the car title.
Yes, you can sue the person you co-signed for if they don't make the payments they promised to make.
However, in certain legal circumstances, the cosigner may face jail time. For example, in a case where the co-signer helped to facilitate the defendant's flight, provided false contact information, or in any way assisted the defendant in evading prosecution.
Cosigners can't take possession of the vehicle they cosign for or remove the primary borrower from the loan since their name isn't on the vehicle's title. Getting out of an auto loan as a cosigner isn't always easy. However, knowing what you signed on for as a cosigner is key. You're not out of options.
Fortunately, you can have your name removed, but you will have to take the appropriate steps depending on the cosigned loan type. Basically, you have two options: You can enable the main borrower to assume total control of the debt or you can get rid of the debt entirely.
Cosigning a loan doesn't give you any title, ownership, or other rights to the property the loan is paying for. Your only role is to repay the loan if the main borrower falls behind on the payments or defaults.
Can a cosigner repossess a car? It's important to know that taking possession of the car if the primary borrower defaults, or “taking matters into your own hands,” is not a legitimate substitute for legal action.
The answer to this question may vary depending on the specific laws and regulations of your jurisdiction. However, in general, repo agents are typically prohibited from repossessing a vehicle with occupants inside due to safety concerns and potential legal ramifications.
Repossession is really bad news for both the borrower and the cosigner. Not only will the borrower lose their mode of transportation, but one of you will likely have to pay the remaining balance, and credit scores belonging to both of you will take a hit in the process.
While you don't necessarily have the same rights to the vehicle as the primary borrower, you – as the co-signer – are equally responsible for ensuring the loan is paid back. If the primary borrower doesn't make their monthly loan payment, you will be asked to make the payment.
Acting as a co-signer can have serious financial consequences. First, co-signers assume legal responsibility for a debt. So, if the primary borrower is unable to pay as agreed, the co-signer may have to pay the full amount of what's owed. Second, a co-signed loan will appear on the co-signer's credit reports.
A cosigner on a loan is legally responsible for the debt if the primary borrower defaults. Cosigning a loan will show up on your credit report and can impact your credit score if the primary borrower pays late or defaults. Cosigners may sign for student loans, personal loans, credit cards, and even mortgages.
If you cosign a debt and the borrower doesn't pay, in most every case you will be responsible for the entire debt. And, the lender does not have to try to collect from the borrower. It can look to you even if it might be possible for it to collect from the borrower.
Additionally, the co-signer may need to pay attorney fees if legal action is required. Lenders can garnish the wages of co-signers. If the borrower and co-signer cannot repay a loan, the lender can sue the co-signer to garnish wages and even property in order to satisfy the repayment.
To get a co-signer release you will first need to contact your lender. After contacting them, you can request the release — if the lender offers it. This is just paperwork that removes the co-signer from the loan and places you, the primary borrower, as the sole borrower on the loan.
To remove a cosigner from a car loan and title, you typically need to refinance the loan solely in your name. This involves applying for a new loan based on your creditworthiness and income, which can be challenging if your financial situation has changed since the original loan was taken out.
If you want to sell the car by yourself, you may not be able to – you're likely to need your co-borrower to complete the sale. Both of your names are on the title, which can make selling the vehicle complicated. You're also likely to need your co-borrower's permission to transfer ownership legitimately.
– While the cosigner is contractually committed to the loan, they have no rights to the vehicle. Even if they find themselves having to take over payments, they cannot take possession of the car.