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Not sure if this question should be here or in the law exchange, but basically my dad cosigned my car loan for the purposes of rate reduction (as I had virtually no credit history at the time). My dad didn't put any money down, doesn't pay for any principal, and hasn't paid any of the loan's interest. I pay for everything. For all functional purposes, it is totally my vehicle and he only co-signed so I'd get a lower interest rate. Fast forward a few years and my dad and stepmom are getting a divorce. I don't know the particulars of divorce settlements, but does the fact that he co-signed my auto loan mean that technically it's his asset and would be subject to any divorce agreement? If so, how can I amend this? I do not want to be involved in that process whatsoever, particularly financially.

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    who's on the title? Just you? Or you and your dad?
    – mkennedy
    Jan 7 at 4:20
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    Please add country and state tags; it makes an important difference.
    – RonJohn
    Jan 7 at 4:20
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    PA isn't a community property state. Thus -- if anything -- your father might technically be able to saddle her with half of your debt, therefore keeping more for himself. (Naturally, that would be fought over.)
    – RonJohn
    Jan 7 at 4:25
  • @RonJohn can you elaborate a little? What is a community property state and how does that directly relate to my situation?
    – Runeaway3
    Jan 7 at 4:31
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    Community Property is a notion in some states with French and Spanish heritage; all assets and liabilities acquired during the marriage are the property of the "community" (aka the marriage partners), to be split evenly upon divorce. Other states (like PA) "equitably distribute" assets and liabilities, which means that your father's lawyer might be able to convince the judge that your stepmother deserves half of the debt. (Naturally, your mother's lawyer would fight it.)
    – RonJohn
    Jan 7 at 4:37
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The co-signer is responsible for paying the loan back if you can’t or don’t want to pay. Being co-signer doesn’t give them any rights to your car. What happens in the private life of the co-signer, like divorce, makes no difference, they are still co-signer.

In extreme situations, like your dad co-signed but it was actually your wealthy ex-mother in law who would have paid, well, that’s just too bad for your dad. Shouldn’t have co-signed.

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  • While simply being a co-signer doesn't confer rights, if the OP were to default and the 'co' was required to make payments, would the 'co' then acquire a property interest in proportion to payments he makes?
    – Jim Mack
    Jan 7 at 22:39
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    @JimMack No. They aren't buying the car, they're paying back the loan. Jan 7 at 23:54
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    @DavidSchwartz so in other words: regardless of who's obligated to pay for the loan, whoever is on the vehicle title is the person with "rights" to the car, ie the owner, right? Jan 8 at 5:12
  • In my situation, I bought two vehicles, one for me, one for my wife. Each was signed by one of us, cosigned by the other. As a result, the titles both had both of our names on it. We had to include those in the Settlement Agreement, but it was as simple as saying that I was to be assigned total ownership of both vehicles. It ended up being a bit messy because of how the divorce went down, but ultimately it turned out okay. Conferring with a lawyer is advisable.
    – phyrfox
    Jan 8 at 14:22
  • Surely it's OP's dad's liability, and therefore taken into account when splitting assets in the divorce?
    – UEFI
    Jan 8 at 14:22

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