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LegalKnowledge, Attorney
Category: Legal
Satisfied Customers: 27584
Experience:  10+ years handling Legal, Real Estate, Criminal Law, Family Law, Traffic matters.
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My daughter cosigned for her boyfriend on a car loan last

Customer Question

My daughter cosigned for her boyfriend on a car loan last year. They broke up in March of this year. Since then he has missed payments on the loan and the car has been repossessed. Is there any option whatsoever for my daughter to have her name removed from the car / loan?
Submitted: 9 months ago.
Category: Legal
Expert:  LegalKnowledge replied 9 months ago.

Hi! I will be the professional that will be helping you today. I look forward to providing you with information to help with your question and concern

Expert:  LegalKnowledge replied 9 months ago.

If the vehicle has already been repossessed, then the finance company is going to sell it and if there is any deficiency, go after her or her ex-boyfriend. At this point, since there was a default and the car has been repossessed, I am sorry to say but it is not possible to simply get her off the loan. I say this because her ex would have to either assume the loan or refinance it and seeing what stage this is at, it is not possible at this time. If she were to pay this on his behalf, she would then have to sue him to recover what she paid on his behalf.

Expert:  LegalKnowledge replied 9 months ago.

I just wanted to follow up and see if you had any other questions or needed me to clarify something. I am here to help, so please let me know. Thanks!

Customer: replied 9 months ago.
I do. Since the bank who has the loan intends to sell the vehicle at an auction, is it better for her to retrieve the vehicle and try to sell it on her own?
Expert:  LegalKnowledge replied 9 months ago.

At this point, they are not going to give it back to her or him. It is in their possession and they do not have to return it. If they did, it is a security risk and they will not lose it or give it up.

Customer: replied 9 months ago.
Even if she pays delinquent amount owed, they still won't give her the car back?
Expert:  LegalKnowledge replied 9 months ago.

She needs to speak with them and see if they will allow that, at this point. If she pays it off, she needs to continue to pay but she needs to see if the finance agreement allow her a chance to cure once they accelerate the full amount due clause and take the car back. That is the issue. Sometimes the bank can demand payment in full or sell the car. They do not have to allow her to get caught up and return it and start paying again, if they do not want to so she can speak with them though about this.

Customer: replied 9 months ago.
The bank stated that if 2300 was paid by Nov 7th they would return the car to her. After that, they were going to sell the car at an auction, probably only getting 5000 for the car, if that. The remainder of the loan, along with the repossession, would remain on her credit history. My question was, would it be better for her to pay the 2300, retrieve the car, and attempt to sell it on her own? This would seem the better option, but she still won't get the full amount of the loan, maybe just the blue book price of the car if she's lucky. The rest of the amount of the loan she'd still be liable for, plus she'd n need his signature to sell. So either way her credit is screwed. I'm just wondering which would be the lesser of the two evils.
Expert:  LegalKnowledge replied 9 months ago.

She needs to perform her due diligence and try and determine what the car is actually worth. Selling it to a dealer is not going to bring her the most, so she needs to try and find out what she can get from a 3rd party / private buyer. Then, she can decide if she should pay it and sell the car and see what she will owe or if it is better to just let them sell it and put in the deficiency.

Customer: replied 9 months ago.
The value of the car is 13,000 according to our bank, but I'm not sure how that can be. It was a brand new car, the loan is for 33,000. She would be lucky if she she got 10,000 for it, which means she would still be paying on 23,000 on top of her student loans and her other bills. Plus, this option would require her to obtain her ex's signature, something I'm sure he wouldn't give. She did perform her due diligence, we went to the bank and these were the numbers they quoted us. The bank also stated the repossession and the collection for the debt would stay on her credit for longer than seven years. If she filed for bankruptcy, wouldn't that stay on her report for only seven years?
Expert:  LegalKnowledge replied 9 months ago.

Do you know how much is owed on the loan?

Customer: replied 9 months ago.
The original loan was for 38,000. 33,000 is the amount still owed.
Expert:  LegalKnowledge replied 9 months ago.

If her Ex is not going to cooperate in the selling of the car, if she were to pay them the requested $2300 to get it back, there may be no point in doing that, because she would then be paying for a car and using it and then need to take the ex back to court, to get the Judge to either award her the car or for it to be sold. If she did allow them to sell it and it was repossessed, it would remain and if they went after her and she filed for BK, it could discharge the debt and would remain for roughly 7 years.