Can I sue someone I cosigned for?

Asked by: Prof. Tyrese Dach  |  Last update: January 26, 2025
Score: 4.4/5 (48 votes)

Yes, you can sue the person you co-signed for if they don't make the payments they promised to make. You may be able to get a judgment against them in court, but it could be hard to collect that money since they didn't pay the debt in the first place.

What happens when you cosign for someone and they don't pay?

You will have to sue the person for the debt. Whenyou co-sign a loan you agree to be liable to the lender in case the borrower does not pay. BUT you have no control over the situation. When the borrower does not pay you have to, and then you have to sue the borrower to get a judgment to try to get your money back.

How can I legally get out of a cosigned loan?

lenders do not remove co signers from loans. The debt has to be retired. This can be done by paying it off directly or refinancing the loan.

Can a cosigner take me to court?

If you're the primary borrower on a debt, your cosigner can take you to court for: Recovery of money paid: they can sue you to recover the money they've paid towards the loan. Fraud: they can sue you if you signed their name to the loan without their permission.

How can co-signers protect themselves?

5 ways to protect yourself as a co-signer
  1. Serve as a co-signer only for close friends or relatives. One of loan co-signing's biggest risks is potential damage to your credit score. ...
  2. Keep copies of all the loan documents. ...
  3. Create a contract. ...
  4. Track monthly payments. ...
  5. Ensure you can afford payments.

"I Co-Signed for A Friend, Can I Sue Them?"

42 related questions found

What legal rights does a cosigner have?

Being a cosigner does not give you rights to the property. A cosigner has no title or ownership in the property secured for the loan. Additionally, a cosigner has no legal right to occupy a home as a primary or secondary residence, unlike the primary signer/borrower.

Can a primary sue a co-signer?

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.

Can I sue someone I cosigned a car for?

Can I sue the person I co-signed for if they don't pay? Yes, you can sue the person you co-signed for if they don't make the payments they promised to make. You may be able to get a judgment against them in court, but it could be hard to collect that money since they didn't pay the debt in the first place.

Can a cosigner go to jail?

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.

Can I kick out a co-signer?

When your credit score improves, you have the option to remove the co-signer from your loan. You can remove the co-signer by refinancing your auto loan, receiving a co-signer release or paying off the loan.

Can I remove myself as a cosigner?

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.

Can a co-signer take your car away?

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.

How long does a co-signer stay on a lease?

A co-signer typically stays on a lease for the entire duration of the lease term, which is usually one year for most residential leases. However, the specific duration can vary depending on the terms of the lease agreement and the policies of the landlord or property management company.

How do I get out of a cosigned loan?

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.

Can a cosigner get in trouble?

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.

Why is it never a good idea to cosign for a friend?

If you co-sign a friend's loan and he misses a single loan payment deadline, your credit score could drop. If that happens, it might be harder for you to buy a house or get a low-interest rate on a loan in the future. If your friend fails to pay back whatever he owes, the lender might sue you first.

How much rights does a cosigner have?

No. 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 you take back being a cosigner?

Some lenders have a release option for co-signers, according to the Consumer Financial Protection Bureau. A release can be obtained after a certain number of on-time payments and a credit check of the original borrower to determine whether they are now creditworthy.

What power does a cosigner have?

They are equally responsible for the debt and must pay if the borrower does not make payments or defaults on the loan. Who can be a co-signer comes down to credit history and standing. A co-signer must have their income, assets, credit score and debt-to-income ratio in good shape to receive approval.

How to sue as a cosigner?

SUE THE ORIGINAL BORROWER.

You can file an action in small claims court (in some states such as Georgia this is the Magistrate's Court) to recover any amount you have to pay on the borrower's debt, plus court costs. If you succeed, you may be able to recover some or all of your loss.

What if a cosigner refuses to pay?

If they stop making payments, the responsibility will be passed on to you—and you could be sued if you don't follow through. Your credit could also suffer. Understanding what you're getting into can help you decide if being a cosigner is worth the risk.

Can a co-owner repossess a car?

So in other words, the law would allow you to repossess the vehicle, but since it's co-owned, you can't keep it from the co-owner. Also, you can't sell it without their consent, so consider one of those options.

What happens to cosigner if I don't pay rent?

You would be sued if the rent is not paid. You are jointly and severally liable for the lease when you are a co-signer. This means that if the rent is not paid, the Landlord can pursue all persons on the lease or just one person.

Can a cosigner take themselves off?

You can remove yourself as a co-signer, but it's not always easy. When you ask for a co-signer release, it's common to get turned down. When you co-sign a loan, you're taking on full responsibility for that financial obligation, along with the primary borrower.

Who owns the car if there is a co-signer?

Although liable for payments if you default, the cosigner doesn't share vehicle ownership and won't be on the car title. They also generally don't make the regular monthly payments. Co-borrower: A co-borrower shares financial responsibility and ownership of the car from day one.