If you are a cosigner on a car loan and the primary borrower has stopped making payments, you might be wondering if you can take possession of the car.
Unfortunately, the process is not as simple as just taking the car. As the cosigner, you have agreed to be responsible for making payments if the primary borrower cannot. You don’t have any legal rights to the vehicle.
If you want to take possession of the car as a cosigner, the first step you’ll want to take is to review the loan agreement and any relevant documents to determine what your rights are. You can also contact the lender to find out if they offer any special options for a cosigner in this situation.
If the primary borrower is willing to work with you, you may be able to negotiate a solution that allows you to take over the loan or transfer ownership of the car to yourself. However, if the primary borrower is uncooperative, you may need to take legal action to enforce your rights as a cosigner.
It is important to remember that taking possession of a car you cosigned for can be a complicated and potentially costly process. Before taking any action, it is recommended that you consult with a legal professional to ensure that you are following the proper procedures and protecting your interests.
By cosigning the car loan, you agree to take on financial responsibility for the loan if the primary borrower defaults. This means that if the primary borrower stops making payments then you will be responsible to make them instead.
Before you cosign a loan, it’s important to understand the risks involved.
Here are some things to keep in mind:
- You have no ownership rights to the car and simply are agreeing to take on financial responsibility for the loan.
- If the primary borrower defaults, the lender can come after you for the remaining balance on the loan and it can impact your credit.
- If you can’t make payments for the primary borrower then the lender can repossess the car and it can negatively impact your credit.
How Can a Cosigner Become the Primary Borrower?
If you are a cosigner on a car loan and want to become the primary borrower, the only option available to you is to finance the car and purchase it from the primary borrower. In some cases you can refinance the car loan into your name.
This means you will need to apply for a new loan and use the new loan to pay off the existing one. To qualify for a refinanced loan, you will need to meet the lender’s credit and income requirements. You may also need to provide proof of insurance and other documentation.
Before refinancing, it’s important to compare rates and terms from different lenders to ensure you get the best deal. You may also want to consider working with a cosigner release company that specializes in helping cosigners become primary borrowers.
Does the primary borrower need to agree to a refinance?
In short, yes, the primary borrower will need to agree to a refinance since they’ll be essentially selling their car to you as the cosigner and they are allowed to say no to you taking possession.
However, if the primary borrower is unable or unwilling to make the payments on the loan, you may be able to take possession of the car without their consent. This will typically require legal action and may result in damage to your credit score.
It’s important to communicate with the primary borrower throughout the process and try to come to an agreement that works for both parties. If you are unable to reach an agreement, you may need to seek legal advice or mediation to resolve the issue.
Process of Changing Possession of a Cosigned Car
If you cosigned a car loan and you want to take possession of the car, there are a few steps you need to take.
Here’s what you need to know about the process of changing possession of a cosigned car:
Step One: Communicate with the Primary Borrower
The first step is to communicate with the primary borrower. You need to discuss your intentions with them and try to come to an agreement.
Here are some things to keep in mind when communicating with the primary borrower:
- Be clear and direct about your intentions.
- Explain your reasons for wanting to take possession of the car.
- Listen to the primary borrower’s concerns and try to address them.
- Be willing to compromise and negotiate.
Step Two: Transferring Ownership
Once you have reached an agreement with the primary borrower, you will need to transfer ownership of the car.
Here’s how to do it:
- Check the title: Make sure the title is in both your names. If it’s not, you will need to have the primary borrower add your name to the title.
- Fill out the transfer of ownership section: The title will have a section for transferring ownership. Fill it out with your information as the new owner.
- Submit the title: Take the title to your local DMV or tag office to submit it and pay the transfer fee. You may also need to provide proof of insurance.
Step Three: Remove the Primary Borrower
If the primary borrower is still on the loan, you will need to remove them in order to fully take possession of the car.
Here are some options:
- Refinance the loan: You can refinance the loan in your name only. This will require you to have good credit and income.
- Pay off the loan: You can pay off the loan in full. This may not be an option for everyone, but it will give you full ownership of the car.
- Cosigner release: If the loan has a cosigner release option, the primary borrower can apply for it. This will allow them to be removed from the loan and give you full ownership of the car.
Remember to keep all communication and documentation well organized throughout the process. This will help prevent any misunderstandings or legal issues down the road.