cancel
Showing results for 
Search instead for 
Did you mean: 

Wife co-signed a car loan... now cosigner can't pay. What are our options?

New Member

Wife co-signed a car loan... now cosigner can't pay. What are our options?

Need some help here.  Wifey helped out a co-worker who needed a car loan.  He ended up being a bad, bad, bad guy.  She already knew this but helped him anyway..  I was not involved in the transaction in any way.  The loan was for a new compact car, but it covered a previous loan that he could not pay for, so the car is only worth around $12-14K but the loan is for over $30K.  She's asked to have him take it over but he either can't or won't.  Anyway, turns out he's lost his job again and almost certainly won't be able to pay for his car.  No way do I want to end up paying for this guys problems, not after all the problems he's caused for our family.  On the other hand, I don't know what options I have.  My wife can't file bankruptcy as I live in WA and they would come after me.  I don't care about our credit... we have everything we need, so I'm happy to just tell them to go shove it.  But at some point I assume they would come after us and garnish at least her wages.  Do we have any real options?

Message 1 of 23
22 REPLIES
Regular Contributor

Re: Wife co-signed a car loan... now cosigner can't pay. What are our options?

Well I am very sorry to hear the situation you are in, but I would go to the dealership/ bank where the original loan was dispursed and inform them of the situation. Tell them to go and repossess the car immediately, at least you will recoup some of the lost funds this way. You need to look over every inch of the documentation your wife signed and more than likely contact a lawyer. I am unfamiliar with the bankruptcy laws or specific laws in your state, but end all be all the bank chose to use a 15k car as collateral on a 30k loan. If the debtors default (this guy and your wife) they have the right to repossess the car, and sue for the remainder of the loan not covered after sale of the collateral. If the other party gets a judgement for the remainder owed against your wife, I am unsure if they will be able to touch your (husband) personal funds, it depends on the laws in your specific case, but your wife's funds or joint accounts are fair game.

 

I would suggest going to the bank who holds the loan and discussing possible remedies to this situation. DO NOT AGREE OR SIGN ANYTHING BEFORE A LAWYER REVIEWS THE PAPEWORK.

 

Good Luck.

Age: 22 //Cards: Chase Freedom, Chase Amazon Visa, Discover IT, CreditOne, CapOne Quicksilver, CapOne Cash, Walmart, Barclaycard, Citibank BestBuy, NavyFederal Visa Signature cashRewards //AAoA: 1 Year 3 Months (but going down quickly Smiley Tongue) //CK:692, Sesame:656
Message 2 of 23
New Member

Re: Wife co-signed a car loan... now cosigner can't pay. What are our options?

The bank that holds the loan has not been particularly helpful.  Basically they have said there is nothing they can do unless he refinances the loan without her.  He isn't willing or able to do that.  They are aware of the situation and will repossess the car if he misses payments, which he has not yet.  My hope was that he wouldn't and we could just forget about the matter.

Message 3 of 23
Established Contributor

Re: Wife co-signed a car loan... now cosigner can't pay. What are our options?


white_rm wrote:

Need some help here.  Wifey helped out a co-worker who needed a car loan.  He ended up being a bad, bad, bad guy.  She already knew this but helped him anyway..  I was not involved in the transaction in any way.  The loan was for a new compact car, but it covered a previous loan that he could not pay for, so the car is only worth around $12-14K but the loan is for over $30K.  She's asked to have him take it over but he either can't or won't.  Anyway, turns out he's lost his job again and almost certainly won't be able to pay for his car.  No way do I want to end up paying for this guys problems, not after all the problems he's caused for our family.  On the other hand, I don't know what options I have.  My wife can't file bankruptcy as I live in WA and they would come after me.  I don't care about our credit... we have everything we need, so I'm happy to just tell them to go shove it.  But at some point I assume they would come after us and garnish at least her wages.  Do we have any real options?


Sell the car, get as much as you can. I don't know how much this will help. But its still not going to fix your problem. I know you weren't involved with the transaction at all, but you really should have been involved, and stopped it. You're the husband. No judgement or blaming here, I'm a little blunt. Its the luxury of talking over forums. I can feel your frustration though, being in a situation like that. 

 

Also, I know you're not worried about your credit, but I'd suggest you have her apply for credit cards now while she can (if her scores arent already affected). A general piece of advice I tell my clients is to obtain and secure credit when you don't need it and are able to. Because when you do need it, it wont be available. You might even want to open up some credit. 

Message 4 of 23
Frequent Contributor

Re: Wife co-signed a car loan... now cosigner can't pay. What are our options?

Jeez....

NFCU Sig Cash-20k/ Amex BCP-19.4k/ Amex Costco-1.2k/Chase Marriott-12k/CSP-13.4k/ Freedom-5.5k/ Discover IT-14k/NCSECU-5k/Walmart-10k/Lowes-25k
Message 5 of 23
Valued Contributor

Re: Wife co-signed a car loan... now cosigner can't pay. What are our options?

divorce

Too many INQs & low AAoA so I'm off to tend the Garden.     Age:23    


     $17k       $8.5K          Closed          $19k      $6.5k        $24.2k        Closed         $5k       Closed     $8.5k        Closed      @2.49%
Message 6 of 23
Frequent Contributor

Re: Wife co-signed a car loan... now cosigner can't pay. What are our options?


Dustink wrote:

divorce

+1

 

NFCU Sig Cash-20k/ Amex BCP-19.4k/ Amex Costco-1.2k/Chase Marriott-12k/CSP-13.4k/ Freedom-5.5k/ Discover IT-14k/NCSECU-5k/Walmart-10k/Lowes-25k
Message 7 of 23
Established Contributor

Re: Wife co-signed a car loan... now cosigner can't pay. What are our options?

lol divorce is a little dramatic. I don't think this is a reason to divorce. YOU COSIGNED A LOAN??? I WANT A DIVORCE! 

 

Maybe he should just be more involved in her finances (their finances).

Message 8 of 23
Established Member

Re: Wife co-signed a car loan... now cosigner can't pay. What are our options?

Whoa,  your wife.... what a bad decision... this is not even a relative...

 

Good Luck...

Isn't the entire point of cosigning is that if the primary defaults the cosigner is responsible?

Message 9 of 23
Valued Contributor

Re: Wife co-signed a car loan... now cosigner can't pay. What are our options?

Can you go get the car?

 

If you are gonna end up paying for it, might as well have it in your driveway.

Message 10 of 23