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I cosigned for my son. He took off in the car before it was fully financed. I want my name off the car.

We signed paperwork stating we agreed on a 60 month term through a bank but then found out the bank can't do that long and wanted to lower the month term and increase the monthly payment.

My son had already taken off in the car and did not want to talk with me about anything going on nor give up the keys to the car. I have had the police out but they only put out a missing person. He is no longer working and I know that his bank account is severely overdrawn; due to mail coming to my home. The contacts we have who have contact with him aren't telling us anything. I don't know if there is anything more I can do to find him.

I just want nothing to do with the car but without me he wouldn't be able to get it since he is only 18 years old without any credit history and barely started working 3 months ago.

Can anyone please help me out? We are in Harris County, TX but I believe he may be in Galveston County with his mom and brother who have not had anything to do with him since he was a baby until just recently.

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    If you cosigned the loan, then you are responsible for making the payments if he doesn't. At some point, you may start receiving debt collection letters in your name. The finance company have no reason to allow you to remove your name from the loan. – Simon B Jul 15 '18 at 20:03
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    Is your name on the title? If not, then you really have nothing to do with the car already. You can't get out of making the payments though -- you agreed to make the payments if your son doesn't when you cosigned the loan. – David Schwartz Jul 16 '18 at 4:23
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    Your situation is exactly why a bank needed a cosigner. They didn't expect an 18 year old to finish the payments. You took on risks that a bank wouldn't. The correct thing to do was to not cosign, but build up your son's credit so he could get the financing on his own. – Nelson Jul 16 '18 at 5:22
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    Whose name is on the car title? – Ben Miller Jul 16 '18 at 12:08
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    It's unclear what's actually been agreed to here since the bank has apparently come back saying that their original loan terms aren't allowed. If it's indeed not allowed, it sounds like there's no loan in place at all? What kind of paperwork was originally signed? – JBC Jul 16 '18 at 15:57
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My rule is: You never guarantee or co-sign for someone else. If you have the money and want to help then give them the money. If you don’t want to give them the money, then don’t co-sign.

There’s no way for you to get out of this. To make you feel better, it was a costly learning experience, but some people have a lot lot more expensive learning experiences.

Re-reading this: If your son took off before the loan was signed, and you haven’t actually signed anything yet, then nobody can force you to sign, and the car dealer will come after your son for theft.

  • It's not theft. Theft is taking property with the intent to deprive the rightful owner of that property. His son fully expected to become the rightful owner when he took the car. – David Schwartz Feb 12 at 5:24
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    What is it when that turns turns out not to happen but you keep the property? I think this becomes theft at the point where the son is informed the car is not his and he doesn't return it. Becoming incommunicado so you can't be informed may not technically be theft but it's likely a crime of some sort. – Eric Nolan Feb 12 at 11:19
  • @EricNolan Then it's maybe defalcation. – glglgl Feb 12 at 15:08
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It sounds like you co-signed, but are not on the title or registration, which would allow you to report the car 'stolen'.

Your best recourse at this point is to contact the lender, indicate your son is in the wind with the car, and not making payments. Indicate you are not going to make payments either and are willing to allow to the car to go into default and you grant them permission (you may or may not need to do this) to repossess the vehicle.

They are very good and finding cars and may have even added a tracker if this was a high risk lender.

That said, this is going to screw your credit rating for a while. You will need to decide which will hurt you more, the hit on the credit rating, or the lost money to pay for a car your son made off with.

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    Note, a voluntary repossession does not necessarily erase the debt - once the lender has the asset back they will sell it at auction, but if the auction sale price is less than the outstanding loan amount then you will still owe the difference. They will usually tack on the recovery costs as well - tracking, towing, replacement keys, etc. – CactusCake Jul 17 '18 at 20:52
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    Good point @CactusCake, but this may still be less than paying for the whole car his son made off with. – Bill Leeper Jul 18 '18 at 22:14
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I cosigned for my son. He took off in the car before it was fully financed. I want my name off the car.

If you have cosigned for the car loan, you can't unilaterally get out of it. It will be upto the Bank to agree. This maybe difficult as your Son on his own can't get the loan. He may try to arrange for someone else to cosign the loan and get your name off it.

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When you cosign, what you are saying is that if the primary signatory (your son in this case) does not pay, you will. If your son has stopped paying, the lender will expect you to live up to your promise. They lived up to their side. They made the loan as you requested, on the basis of your signature.

There are only three ways to get your name off this loan:

  1. Get your son to refinance the loan under his name. As you note, it seems unlikely that he would be able to do this, even if he agreed. Perhaps his mother would be willing to cosign (although if she asked, we'd recommend that she not do that).

  2. Pay off the loan (either you or your son could do this).

  3. Declare bankruptcy and get the loan discharged.

Some people are recommending a fourth approach, which is to just ignore the loan. This won't get your name off the loan. After a long period of time (probably four years in Texas), the lender will stop trying to collect it from you. In the meantime, it will show as a bad loan on your credit report (and your son's). And they can harass you to collect the loan for that period of time. In addition, they may be able to sue you and compel you to pay the loan. Talk to a lawyer for more information on that.

Cosigning for a loan is a big deal. If the primary signatory does not pay, you are responsible for the loan. That is what cosigning is. You should not do it unless you are willing to gift the person with the money.

Are you willing to declare bankruptcy over this loan? If not, your only real options are to pay it or ignore it. If you ignore it, your credit will take a hit, probably a big one. Paying it would be expensive, but you can negotiate a fix for your credit as part of it. The absolute worse thing would be to switch between options. If you're going to ignore it, accept that it will ruin your credit for years. If you're going to pay it, negotiate that soon. As already suggested, you may be able to get the lender to repossess the car, which will reduce the amount owed.

Negotiating a credit fix may require a lawyer and an escrow company. You agree with the lender on an amount which you put in escrow. They get the money when your credit report is fixed.

If you plan to ignore it, you should also hire a lawyer unless you have no assets or income. Because you really need to be informed on what the lender's options are in terms of forcing you to pay.

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