After a breakup, I'm stuck with a car I cosigned a loan for. Now what?

I cosigned a car loan for my partner. We broke up and I'm stuck with the loan because he can't make the monthly payment ($460). I can't afford it, either. The bank has refused to refinance the loan. What do I do now?

Answer
This is a sticky situation in terms of both finances and legality. Because you’re the cosigner and not the co-borrower, you have no legal right to possession of the car. It’s still owned 100% by your former partner. Yet because your ex can’t make the payments, you’re still on the hook for the payments as a cosigner.
Since you can’t afford the payments or get refinancing, your best bet is to obtain a cosigner release from the lender. This document absolves you from liability on car payments and takes your name off the loan.
If you’ve made on-time payments in the past, the lender may agree to the release. However, you’ll want to move on this immediately to avoid any late payments in the near future, which can put your release in jeopardy.
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Eric Schad
Answered on Mar 12, 2021
Eric Schad has been a freelance writer for nearly a decade, as well as an SEO specialist and editor for the past five years. Before getting behind the keyboard, he worked in the finance and music industries (the perfect combo). With a wide array of professional and personal experiences, he’s developed a knack for tone and branding across many different verticals. Away from the computer, Schad is a blues guitar shredder, crazed sports fan, and always down for a spontaneous trip anywhere around the globe.
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