How Do I Remove Myself As Co-signer on a Loan

I bought a motorcycle a year ago. Now the finance company won't honor a clause the dealer wrote into the loan. What can I do?

I co-signed for a motorcycle in Jacksonville Florida over 12 months ago at a Harley Davidson dealership. In the contract the finance officer and me put in there that after 12 months my name would come off of said loan. All payments have been made on time in fact every two weeks. More than the amount of the payment is also sent. Never has been late either. We call Harley Davidson finance company they own it. Now they say that the finance officer should not have written that and it is not legal. That the laws of Nevada apply for the loan. Not Florida laws. I have the contract no were in the contract does it mention Nevada or laws of that state. They are refusing to take my name off as a co-signer. The original owner does not want to re-finance we got a good rate at 2.9% if we have to re-finance everyone even HD is at 9.9% we would lose. My engine just blew up so I want a new car but this loan is reflecting on my credit and everyone says I have to get that taken care of. I do not have any other bills, own my home for several years. I pay for everything in cash. I don't use credit cards. My credit rating is good. How can I to get off as co-signer if the Harley people will not take me off even though I have it in writing they will?

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Bill's Answer
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  • Contracts are written to lock co-signers in.
  • Refinancing is the best way to remove a co-signer.
  • Bankruptcy will also remove a co-signer's liability.

In general, loan contracts are written to not allow a co-signer to withdraw from the contract at will. There are no, “We are not friends anymore so I want to be released from my co-signer liability” clauses in any loan contract I have seen. If the primary borrower stops making payments, the co-signer has 100% liability for the unpaid debt. There are four ways to relieve a co-signer from a loan’s liability:

  • Refinance the loan in one name only
  • Sell the item secured by the loan and use the proceeds from the sale to retire the loan
  • File for chapter 7 bankruptcy
  • If your signature was forged on the loan application, file a lawsuit against the borrower and ask the court for relief

If the loan in question is a student loan, some lenders allow for the release of the co-signer when basic requirements are fulfilled. See the Bills.com article Co-signing a Student Loan to learn more about co-signing a student loan.

The Facts Here

To paraphrase your facts, a motorcycle dealer in Florida wrote a contract to finance a motorcycle. You are a co-signer. All payments are made in a timely manner, but you want out of the deal because of the impact on your credit rating or debt-to-income ratio. The Florida dealer wrote terms that, one year later, the Nevada finance company refuses to honor.

It would be unusual for a lender to write a clause in a loan agreement that would allow a co-signer to remove him or herself from an agreement, and I am not surprised that the finance company would balk at this. Under normal circumstances, the only way you can extract yourself from this type of contract is for the other cosigner to refinance and put him or herself as the borrower. However, the Florida dealer wrote this clause into the contract, both parties signed it, and the Nevada finance company never raised this clause as an issue over the last year.

I recommend you and the cosigner to speak with an attorney in Florida with experience in consumer law to determine what your rights are under Florida law. My guess is that the Florida attorney will use a legal doctrine called “laches” to ask a Florida court to enforce the clause.

I hope this information helps you Find. Learn & Save.

Best,

Bill

Bills.com

52 Comments

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  • 35x35
    Mar, 2012
    Althea
    Hi there, I got an experience of being a co-signer for my sister's student loan 7 years ago. I'm an active military member, Once i get my PCS here in Florida, the American Education Services sent me a letter of my sister is delinquency in payment. So, Because she is my sister and i trust her, i called her and told her about the notice that i got and she told me that, she already made a payment,just disregard the letter i got. And last July 2011 i got deployed in Iraq and once i got back January 2012, i got this notice that i need to pay the full amount left in the loan because they can't contact my sister. And since I cosigned that loan I'm aware of the responsibility. I call the Loan Agency right away and told to me that if i pay the full amount it will not the hurt my credit score. So, I know i don't have a choice, the next day i paid it. Not a credit card but in my own cash. I don't use credit card just to let you know. I always make advance payment in all my bills. And now the hard part, I just got my new vehicle and when i need to get a loan to my own bank, They denied me because a have a full credit score and did reflect the delinquency payment of that student loan i co-signed. Now i wanna know if there's anything i can do to fix and erase that bad credit history in my name? My point is, during the time they are sending me the notice of delinquent payment, I'm not aware of that because I'm deployed! But once i got back in florida and saw that letter, right away i call them and paid that loan. Is there's any legal steps i can do to fix it? Just wanna know because it's really hurt my credit score an the fact that it's unfair in my side because I'm not aware of those notices that they are sending me. Hope to get a reply. Highly appreciated in advance.
    0 Votes

    • 35x35
      Mar, 2012
      Bill
      You described the consequences a co-signer faces when the primary borrower defaults on a loan. Not only does the co-signer suffer harm to their credit score, but also has liability to repay the balance due if the primary stops paying altogether.

      You mentioned being an active military service member. Under the Servicemembers Civil Relief Act (SCRA), a federal law, special protections exist for those on active duty or who recently completed active duty regarding their financial obligations. I confess I am not well-versed in the SCRA, but based on my limited understanding of the act, creditors are not barred from reporting delinquent debts of active duty members to the credit reporting agencies (the credit bureaus). Consult with your local judge advocate general to learn if the SCRA applies to any part of your issue.

      If not, consider writing a letter to the lender explaining your situation, and ask that as a matter of good will, it remove the derogatory mark from your credit file.
      0 Votes

  • 35x35
    Feb, 2012
    Muki
    HI, About 9 years ago, I signed for a 30 year mortgage with my brother and my Mom. At the time, the bank we signed with was Country Wide and through them they decided not to use my credit because it wasn't strong enough. So in other words, the bank statements that paid the mortgage did not have my name on them. Since then, I got married, moved out and bought a home with my wife (lived here for 5 years). When I purchased my home with my wife, the bank did not have any records of the house with my brother. Fast forward, Bank of America bought Country wide and assumed their loans. My signature was on the document so they added my name to their loan documents without notification. I found out about the change when I completed a refinance. So I've read the four different ways to remove myself. Is there any other way? If I file Chapter 7 would I lose my home I live in? If i involve a lawyer, would I get a different result?
    0 Votes

    • 35x35
      Feb, 2012
      Bill
      You should speak with a lawyer. You say that you signed for the loan, so you seem to have been responsible for the whole time, even though your name was not on the monthly statements. Still, it may be the case that you were not part of the loan or that BofA did something improper in adding you to the loan.

      If you are responsible, speak with a bankruptcy attorney, to see if filing for bankruptcy could help you remove your BofA loan debt and what the effects would be on your current home and assets.
      0 Votes

  • 35x35
    Feb, 2012
    Jennifer
    I am the co-signer on a student loan. A few years ago a friend asked me to co-sign for his student loan, however since I was on the west coast and he was on the east coast at the time he forged my signature on the student loan. He was since kicked out of school and now refuses to make any payments on the loan or to reimburse me for any of the payments that I make to keep the account in good status. Unfortunately I have been reported twice for the loan being too delinquent, past 60 days, however the only reason I was reported is that I never received any phone call notification that the loan was that far past due and I was going to be reported to the credit bureau. The loan company does not send me any statements or documents of the loan, which I have asked for many times. I wanted to see how I can get the original papers for the loan and request statements and receipts of payments, and any advice on ways I can go about getting myself off of this loan! Thanks for your help.
    0 Votes

    • 35x35
      Feb, 2012
      Bill
      There are four ways to remove oneself as a co-signer:
      1. Refinance the loan and not include a party in the refinance.
      2. Sell the property in question (if the loan is secured), which will extinguish the loan liability, unless there is deficiency balance.
      3. File for chapter 7 bankruptcy.
      4. If the loan is for a home, allow a strategic default. However, all parties on the loan will be responsible for any deficiency balance.

      Student loans are different from secured loans because, obviously, there is no property securing the loan. Student loans are also different from other consumer loans in that they cannot be discharged in a bankruptcy, unless there is a hardship.

      In your case, an act of fraud attributed liability to you for the loan. It would be unfair for a court to enforce a forged contract. You need to create a affidavit that states you did not sign the loan contract. See the Dept. of Education false certification discharge discussion. See the Sallie Mae Student loan discharge or cancellation page to learn how to contact Sallie Mae's claims department.

      0 Votes

  • 35x35
    Jan, 2012
    Kit
    When I was 17 I had a co-signer help me get a car from a dealership. He signed stuff but I paid for everything, down payment and insurance and all of that, for exactly a year and a half out of a 3-year payment plan. I lost my job so I couldn't continue to pay for the car. My brother picked up paying for the car for exactly the past year's time, and at the time that he started paying for it, said it was cool if I wanted the car back in the future, he just wanted to use it right now. I brought it up again recently and he was still cool with me having the car back. Now, when I spoke to the original co-signer, a month or two ago he was fine with everything and kept saying we would get together and talk about it. Now when I'm trying to get together with him so we can really discuss and plan things and work it all out so that I can either a) have the car back and pick up paying for it again, or b) have back the $6,000 (out of 10,000 total) that I have already paid (car only, not insurance) - he (the co-signer) is saying I have no rights, I'm entitled to nothing, etc. etc. So my question is, what are my rights, and what am I entitled to, and so forth? I'd like to get this all worked out as peacefully as possible, but if I must I will use legal force (suing, or something). His name is on the title, but I had paid for everything up until the year-and-a-half mark. He had to pay for the car for a whopping two months before my brother picked up payments on the car. Now that it's January, it has been a year that my brother has had the car now. I live in the state of Virginia, if that helps for a detailed answer :P
    1 Votes

    • 35x35
      Jan, 2012
      Bill
      I will assume the brother you mentioned is the co-signer. The co-signer bases his theory of complete and total ownership of the vehicle on his name appearing on the title. That gives him the right to possess and sell the vehicle, as far as the state is concerned. You base your claim to own a partial interest in the vehicle on your making payments for half the life of the loan. He has a legal claim to the vehicle, and you have an equitable claim.

      It would be unfair for the co-signer to have complete ownership of a vehicle he paid only 50% for. Assuming you can prove to a court you made 18 out of 36 payments, then a court will agree you own 50% interest in the vehicle.

      A lawsuit is expensive. Mediation is cheaper. Explain to the co-signer that you would like to settle this dispute with a mediator. If the co-signer does not accept this alternative, then you two choices: Let it go, or file a lawsuit.
      0 Votes

  • 35x35
    Oct, 2011
    Jaryn
    About 2 days ago I cosigned for a friend for a used car from a used car lot. I was wondering if there is a 3-day time line to resign as the cosigner and return the car to the used car lot. Is this possible?
    0 Votes

    • 35x35
      Oct, 2011
      Bill
      I am not aware of any state law requiring an X-day cooling off period when buying a car, or a cooling off period for loan co-signers.

      You asked about returning the car. Certainly, the dealer will buy the car back at a discounted price. Make the dealer an offer.
      0 Votes

  • 35x35
    Oct, 2011
    Steve
    I believe my father has put me down as a co-signer on my sisters student loans. I told him I did not want to cosign. Is there any way I can check to see if he has or not?
    0 Votes

    • 35x35
      Oct, 2011
      Bill
      The least reliable means to determine if you are co-signer is to check your credit report. If the loan is not on your credit report, however, that does not mean you are in the free and clear. The most reliable means to learn if you are a co-signer is to ask the student to see all of his or her loan contracts.

      If your signature was forged on the loan contracts, consult with a lawyer who has consumer law experience. You may be able to release yourself from liability.
      0 Votes

    • 35x35
      Mar, 2012
      chandrika
      I co-signed student loan for my son. He is not working and i have not enough money. I want to release my responsibility from student loan. Right now he is not living with us. Please give me a suggestion.
      0 Votes

    • 35x35
      Mar, 2012
      Bill
      Unfortunately, there is no good solution for your situation. Student loan co-signers may be removed in some cases, but it requires the student to meet certain conditions, such as demonstrating an ability to pay the loan and there being a history of timely payments. If collection efforts against you take place, you should seek the counsel of a bankruptcy attorney. Even if you can't discharge the obligation to pay the debt, a bankruptcy may allow you to work out a payment that you can afford.
      0 Votes

  • 35x35
    Sep, 2011
    sean
    My spouse co-signed on a student loan for a friend 3 years ago. She recently applied for a student loan herself but was denied because of delinquent payments on the friend's student loan. She is a stay at home mom and make no income. Is there away she can remove herself from the friend's student loan or is there any legal advice you can give?
    0 Votes

    • 35x35
      Sep, 2011
      Bill
      Your question is, unfortunately, a frequent one among Bills.com readers. I know of four ways to remove a co-signer from a loan:
      1. Refinance: Ask the other signer to refinance the loan in their name alone.
      2. Pay off the loan: Paying off the loan removes the liability for all co-signers.
      3. File for chapter 7 bankruptcy: A successful bankruptcy filing resulting in a discharge of this debt will remove the co-signer's liability for the debt.
      4. Fraudulent signature: If the co-signer never signed the loan document, or signed the document under duress, then a court making that finding may order the creditor to remove all references to the debt in the victim's credit report, and cease any collection efforts.

      Readers, I welcome your thoughts and suggestions for other successful tactics to remove a co-signer's liability for a loan.

      0 Votes

  • 35x35
    Sep, 2011
    Alisha
    My situation is similar to most of these. My fiance's ex wife had three student loans taken out while they were married. He cosigned two of them. They total some $150,000.00. This debt was never addressed in their divorce decree, she has been paying on them for the past four years. Well recently she's threatened to file bankruptcy or take him to court to try and make him pay on these loans since she can no longer afford to do so. I realize that she can't make him pay anything, only the creditors can. And since these are school loans, bankruptcy won't wipe the debt away. Obviously we don't want to pay on her school loans, something he (and apparently she) never benefited from. Will this be something that will plague him for the rest of his life if she refuses to take care of them? OR is there a way he can perhaps negotiate with the creditors to pay a portion and have his name taken off the loan? How will this effect me when we get married? Appreciate the help.
    0 Votes

    • 35x35
      Sep, 2011
      Bill
      Student loans are unusual for several reasons. In some states, when a person with student loans divorces, state law severs any liability the ex-spouse has for the student loans. Unfortunately, I do not know if your state (Oklahoma, presumably) is one of these states. Consult with an Oklahoma lawyer who has experience in family law where student loans are involved. Shop around for family lawyers until you find one who has litigated the student loan issue before. I realize my answer is not what you may have hoped, but I would rather give you a sincere non-answer than guess on a critical issue with expensive consequences.
      0 Votes

  • 35x35
    Sep, 2011
    Nick
    Hello, I co-signed for a vehicle for my boyfriend less than 30 days ago and we broke up and now is refusing to pay on the car. Please let me know if there is any option I have knowing that it is less than 30 days since signing
    0 Votes

    • 35x35
      Sep, 2011
      Bill
      I am not aware of any 30-day exemption or exception to allow a co-signatory on a vehicle loan to exit from the contract. To the contrary, loan contracts are specifically designed to not allow co-signatories to come and go as they please.

      Consult with a lawyer in your state who has consumer law experience to learn what rights you have regarding your situation.
      0 Votes

  • 35x35
    Aug, 2011
    Heather
    Help? I co-signed on a car, with the reasoning that after 6 months or so the person I was co-signing for would be able to build up credit and then refinance on his own. Problem is I thought I co-signed but after everything went through they put me as the primary. Is he still able to refinance on his own, like originally planned?
    0 Votes

    • 35x35
      Aug, 2011
      Bill
      If the co-signer on the vehicle has a consistent income history, a high-enough credit score, and the vehicle is in good condition, then he or she should be able to refinance the vehicle is his or her name alone. Assuming the above, your being the primary today will not prevent a refinance.
      0 Votes

  • 35x35
    Jun, 2011
    John
    hello, just wanted some info regarding an unsecured loan. Back in 2007 my wife applied for a debt consolidation loan through Bank of America. Her credit score was 786. Bank of America wouldn't give me a loan because i declared chapter 7 bankruptcy. Now the messed up thing is this. Bank of America was wanting to find out our total income, took my social security number(which i never agreed to the loan) and approved my wife for the loan for combined income. well to make a long story short, economy became bad, and i got laid off. My wife was not able to afford the loan and she in the process of declaring chapter 7 herself. I found out they put me on the loan as a joint responsibility, I never signed for the loan nor did i agree to the loan, Is there anyway i can get out of this,even though i never signed or agreed verbally to this loan.
    0 Votes

    • 35x35
      Jun, 2011
      Bill
      Your excellent question should be addressed to an experienced attorney, so you receive an authoritative answer. Not signing for the loan should give you good grounds for challenging your responsibility, though other issues, such as those surrounding community property could come in to play.

      Please report back, after you speak with an attorney, so the knowledge you gain can be shared with others.
      0 Votes

  • 35x35
    Jun, 2011
    Sam
    Hello everyone, my question is this. I wanted to know if there is anyway for me as a cosigner to know if I was taken off of a loan. A little background, I cosigned for a car loan, than in fact was for me. At the time I was not able to get a good rate on my own. So my fiance at the time offered to help me. After some number crunching, it turned out best if she was the main borrower and I was the cosigner. Basically because my income was more than enough just not credit score, and her income was not but her credit score was. All payments to the vehicle were made from me and my bank acc, including the down payment. In the end we broke up and she requested that I return the vehicle to her so she could be rid of the loan under her name via that vehicle. I end up finding out a couple of months later that she is driving the vehicle. I do not know my exact rights. For example how do I know that I am off this loan?
    0 Votes

    • 35x35
      Jun, 2011
      Bill
      Call the lender and ask about the status of the loan. If it has been refinanced, the lender will not give you the time of day. However, if the loan is not refinanced, you may have the right to ask for an account status because you are a co-signer.

      Another less reliable option is to get a copy of your credit report. If the lender is still reporting the loan on your credit report you may still have liability.
      0 Votes

  • 35x35
    May, 2011
    Jes
    Hello, about two years ago I co-signed on a credit card that my boyfriend already had to up the limit. Over the course of our relationship we worked on paying it almost all the way down. However, since we have broken up (about 6 months ago) the credit card is almost maxed out and he has made little effort to pay it off and cancel it. What can I do to get him to pay it off and get it out of my name? Would I have a legitimate case in small claims court? Should I get an attorney?
    0 Votes

    • 35x35
      May, 2011
      Bill
      The law has a difficult time reconciling a situation such as yours. You and your then-boyfriend signed a contract that lacks a "If we break up the contract is canceled automatically" clause. If you were married (marriage is a form of contract) your joint account would have been handled in the divorce decree. But, as I mentioned, when friends part ways the law leaves it to those two parties to resolve their joint accounts.

      If you parted ways with the other joint account holder promising to close or keep the account current, then you can sue the other joint account holder under a breech of contract theory. You can also file for bankruptcy, which will strip you of liability for the debt. Consult with a lawyer in your state to learn about your options.
      0 Votes

  • 35x35
    Apr, 2011
    Erica
    My friend broke up with her boyfriend recently. They bought a car together she has the car as it was for her and to get a lower monthly payment he is the primary and she is the cosigner. She wants to trade in the car for an SUV as she has started doing K9 SAR and needs an SUV for that. He the boyfriend is being very spiteful and won't agree to trade in the vehicle even though they are not together any more. Is there any recourse for her she needs a vehicle so she does not want to be without one. We live in RI. thanks:)
    1 Votes

    • 35x35
      Apr, 2011
      Bill
      Your friend should consult with a lawyer, and ask him or her to draft a letter to the boyfriend explaining that if he does not agree to allow her to sell the vehicle, she will allow it to go into default. This will:
      1. Cause collectors to start collection proceedings against him
      2. Have an immediate and negative impact on his credit score
      3. Leave him open to liability for a lawsuit by the lender

      If this does not work, then the lawyer may have the ability to petition the court to compel the DMV or creditor to change the title so that she can sell the vehicle.

      0 Votes

  • 35x35
    Apr, 2011
    borie
    I am the co-signer for my stepmom. I want my name off the car. She have good credit but no credit. We apply for her credit card and got two, trying to built credit for her. How long would it take for me to take my name off her car loan. And what do i do? Should she apply for a used car loan or should she apply for a refinance, dose that mean she can take money out from the car loan? please help i made a mistake on co-sign for her . Thanks bill or others that can help me out the loan and the process of this.
    0 Votes

    • 35x35
      Apr, 2011
      Bill
      When you co-sign a loan you acknowledge you will be obligated contractually for the payments if the primary borrower stops making payments. A co-signer can remove his or her name from the loan if the primary borrower refinances the loan, or pays off the loan completely.

      If the value of the vehicle is worth more than the balance of the loan, then it is theoretically possible for the borrower to get a cash-out refinance.

      Vehicle loans and refinances take a very short time to complete — a week or less depending on the borrower's circumstances.
      0 Votes

  • 35x35
    Jan, 2011
    Anthony
    I co-signed a sallie mae student loan for my cousin in 2006. I filed bankruptcy in 2008, however, the attorney said I could not discharge any student loans. Is there any way I can be removed as the cosigner of this loan? Can a judge in a small claims court remove me as the cosigner especially since my cousin and I are in agreement? Thanks, AP
    0 Votes

    • 35x35
      Jan, 2011
      Bill
      While your cousin and you may agree that you no longer need to be on the loan, the lender will not agree. The reason that your cousin needed a co-signer was because your cousin's credit was deemed inadequate to qualify for the loan. The lender required a co-signer to reduce its risk. Taking you off the loan increases the lender's risk. From the lender's view, why should it leave only one person responsible for paying, when two are currently responsible. Is there a specific reason you want to be taken off the loan? As long as the loan is being paid on as agreed, then it shouldn't cause you any problems. If the student loan payment appearing on your credit report causes you to be turned down for a loan or credit, because the student loan payment being included in your debt-to-income ratio (DTI), make sure to explain that you are not the one who makes the loan payment. If you can provide canceled checks or proof that your cousin makes the payment, then it will not be included in your DTI.
      0 Votes

  • 35x35
    Dec, 2010
    Christina
    Hello. I need your help. I am a cosigner of a car loan. The car was repo over 3 or 4 years ago and the loan was modified with out me sign any paper work. Now the company is taken me to court for jugdment. Can they do this? also the original loan is while over 7 years old? I thought since I did not sign the modification loan I would no longer have to deal with this loan. also I thought that over 7 years they could not collect on a debt.
    0 Votes

    • 35x35
      Dec, 2010
      Bill
      You should speak with an attorney ASAP. You need to discuss the statute of limitations for collecting on the debt. A car loan is a written contract. The collection statute for written contracts varies from state to states. The shortest statute for written contracts is 3 years and the longest 15 years. The time starts running on the statute from the date of the last payment on the loan. You also want to discuss the issue of the loan modification with the attorney, to see if that paperwork eliminated your financial responsibility as a co-signer.
      0 Votes

  • 35x35
    Sep, 2010
    Bill
    Unfortunately, there is not much advise I can give you. When you co-sign for an auto loan you are acknowledging that you will also be contractually obligated for the payments on the vehicle. In order to remove your name from the loan the vehicle would either have to be refinanced or sold.
    0 Votes

  • 35x35
    Aug, 2010
    Debra
    Hello I co-sign on a vehicle for my son 2 years ago, he make the payments up until now. I want my name off the vehicle, cause he said he not paying anymore on vehicle he is going to let them repo vehicle. He said he is going to mess my credit up for the next 7 years. Im going to court in the morning n talk to a judge, I want the vehicle out of my name as long as he work can the judge order a judgement against him to put the car in his own name. He all ready tried to take it back n they wouldnt take it as a volunteer repo cause they need me to sign too. All i want him to do is get the car in his own name. So i wont have any responsible on the car. Hello everyone Never co-sign for any one again even ur own kids will mess u up. Please give me any advice to help me with this situation.
    0 Votes

  • 35x35
    Aug, 2010
    Bill
    I think a judge will interpret missed payments as very, very late payments. Before your fiance takes it upon himself to repossess the vehicle, consult with an attorney in your state who has experience in consumer law. Allow him or her to review the divorce agreement. With that agreement and the facts at hand and an understanding of your state's laws, the attorney will advise your fiance exactly how to proceed and stay within state law.
    0 Votes

  • 35x35
    Jul, 2010
    BCA
    I recently came across your post and have been reading along. I will visit this often.
    0 Votes

  • 35x35
    Mar, 2010
    The
    To Daniel Peirre: How did you buy your mother a car if she is the one making payments on it?
    0 Votes

  • 35x35
    Mar, 2010
    Bill
    Daniel, you may be in for tough sledding, as creditors rarely let a co-signor remove their names from an account... especially if it is delinquent. You can try, and let us know how it goes, but the best strategy might be to encourage your daughter to pay the account off and get the credit marks updated and then never co-sign again. Good luck. Bill
    0 Votes

  • 35x35
    Mar, 2010
    Daniel
    I co-signed for my daughter about 4 years ago. I bought a vehicle for her. She pay payments on good time for four years. I want my name off from co- signer. My daughter have bad credit. They disaprove her for loans. Should she refiancing it ? I want to move to another house but I cant.
    0 Votes

  • 35x35
    Feb, 2010
    Bill
    It would be very unusual to fund a vehicle purchase with a line of credit. I would start by reviewing the loan contract to find if your assumption that the loan contract is a line of credit is true. If the son was the primary borrower on a line of credit, then the co-signatory does not need to approve any purchases. (However, there may be an agreement between the father and son that requires such an agreement.) Regarding your second question, ask your spouse to bring the loan documents to an attorney in your state who has experience in contract law. Your state may allow a co-signatory to file a lawsuit against primary borrower if there is evidence of fraud. Here, the fact that the son has made no payments on the vehicle may be evidence to show a species of fraud in your state.
    0 Votes

  • 35x35
    Feb, 2010
    J.
    My boyfriend co-signed a loan for his son to by a motorcycle. That bike was totaled in an anccident and the insurance paid off the balance. Then he got a second bike which was paid for. Now the son went and got anotehr bike against the original loan without his father knowing and is not making payments. Now collectors are calling saying he is responsible and the original loan was an open line of credit. Don't both parties have to sign papers every time money is taken on an open line of credit ? He was not aware this was an open line of credit and this is ruining his perfect credit. Is there any legal action he can take ?
    0 Votes

  • 35x35
    Oct, 2009
    Bill
    You need to take all of your documents relating to the divorce and the student loan either to the attorney who represented you in the divorce or one who is experienced with family law in your state. Generally speaking, co-signers on a loan are stuck with it until the balance is paid or the loan is refinanced. The divorce agreement may have obligated your ex-spouse to refinance the student loan. Also, there is a chance you may not be a co-signer at all. An attorney's time is not cheap, but in this situation it will be money well-spent to understand your rights and liabilities.
    0 Votes

    • 35x35
      Jun, 2011
      Valeria
      My husband has the same problem, but he didn't make any agreement in the divorce to put him out of this loan. His ex wife is not on time with the payments, she has fail many times and she is ruining our credit score. It is another way to get out from this loan?
      0 Votes

    • 35x35
      Jun, 2011
      Bill
      Lenders are reluctant to remove a person who is financially responsible from a loan, as it increases their risk. Unless the ex sells the property or refinances the loan, your husband will continue to suffer the consequences of his ex's actions. This situation once again illustrates that severing all financial ties at the time of divorce is a smart thing to do.
      0 Votes

  • 35x35
    Sep, 2009
    Ronny
    I got married three years ago, and since then got divorced. I co-signed for my ex-wife for a student loan in SC and need to know how to get off the loan. Any help would be great. Thanks
    0 Votes

  • 35x35
    Sep, 2009
    Bill
    Let us look at the economics on a 1.9% APR. Even with the prime rate as low as it is today, it costs Nissan more than 1.9% to find and use funds it loans to its customers. The 1.9% APR is a money-loser for the financial department at Nissan, but on the other hand it promotes the sales of its vehicles. Either Nissan eats the cost of its 1.9% loans, or it boosts the price of its vehicles to compensate for the dirt-cheap interest rates it offers. The reason no bank or credit union matches Nissan's rate is that 1.9% is below the market price of a vehicle loan. There is no magic wand anyone can wave to extract you from the loan if Nissan does not want to rewrite its terms. You have three options: 1) Your co-signer refinances; 2) you sell the vehicle and pay the deficiency balance; 3) you and/or your co-signer pay-off the loan.
    0 Votes

  • 35x35
    Sep, 2009
    Daniel
    HI, I bought a vehicle for my mother for her birthday 6 months ago. The veHicle was purchased through nissan financials at a 1.9% APR. I signed as the co-signer and her the primary borrower. Given her high credit rating of 760+, she most definately will qualify for refinancing at a financial institution. MY question is I want to remove myself as a co-signer to free up my credit to buy my first home. I have my car, 3 credit cards all paid off and not used, a motorcycle paid off, and her car on my credit. How do I remove myself off of the loan, although I'll still be paying for it. No banks will give her a 1.9% APR refinancing, the nissan wont budge.
    0 Votes

  • 35x35
    Aug, 2010
    Maria
    Hello, my fiance bought a car for his ex wife two years ago with her as a co-signer. She's been late a few times on the payments, and it was agreed if that happened, she'd have to give up the car however due to some wording in the divorce decree it says if she misses. We called the financial institution and they say there is no "late" payment only missed payments. We are basically tired of being nice and letting it slide. how do we legally take the car back since he is the primary owner?
    0 Votes