Are there any loopholes with co-signing an auto loan?

Answer 1

"I co-signed an auto loan with my ex-boyfriend back in Jul. 2003. He quit his job in Dec. 2003 and is still not working and not paying for the vehicle. His name is on the title and registration and mine is not and his credit is horrible. Are there any loopholes anywhere that I can get the car solely in my name so my credit doesn't get damaged and I can pay off the loan?"

You are the perfect example of why you should never ever ever cosign for a loan. The title is in his name which means that the car belongs to him. If you pay off the loan the vehicle is legally his and you have no recourse.

If the payments are not made the bank will reposses the car and come after you for what is left after they sell the car. Your best option is to stop making payments and let them reposses the car. Be sure to notify them by certified mail that you wish to purchase the vehicle for the amount owing so they don't just sell it without notifying you.

go to small claims and try to sue him...the judge might hear your case.

The real consideration is:

You are certainly responsible for the actions of primary to the extent of the loan....and after that, it will be situational on what other liability could extend to you - but certainly situations no one would want to be in!

A cosigner is only needed because the primary doesn't have adequate credit rating/history for the needed loan.

Hence, the cosigner needs to have credit good enough to qualify for the loan, and secure enough that they can risk much of what they have historically established for likely no real benefit - on someone others with experience won't risk anything on, even with a possible very good business gain.

Understand, being a cosigner is essentially the exact same as getting a loan - the cosigner is just as liable as if he got the loan on his own..in fact he needs to be more responsible. He now has to take on the obligations of the primary too, if needed, likely without the control, posession or benefit of what was purchased.

Which is to say, if someone buys something for themselves, on their own credit, and then loses their job (or whatever) and has problems paying, they can sell the item and pay off (all/much of) the obligation. For many reasons, a cosigner may not be able to.

And let me be clear, it is frequently shown that people who are irresponsible about their own credit (regardless of the excuses for how it got that way) are even more irresponsible about others credit and obligations -- and this extends to obligations like those that come with owning/maintaining things. Things that may have your name connected to them.

The only option for a cosigner to be removed from the financial obligation is for the loan to be refinanced without the original cosigner being involved. It is however possible for a cosigner to sue the primary borrower for damages incurred due to the loan being defaulted. Such a suit would not relieve the cosigner of the financial obligation that he or she originally entered into.

LOOPHOLESThe loans your speaking about are made by banks, professional lenders and other very large, very politically savy and legally influential organizations -- groups of them in fact - with bunches of lawyers and finance people working evey day - spanning many decades - even centuries - and whose commerce is vital to the Country and Society. Pretty fair to think that after making millions of them, they've pretty much seen it all before? Sound like it's really worth pursuing finding a loophole to outsmart them?