I cosigned a new car loan for my nephew and he's failed to make his payments. What do I do in this situation?
My nephew was laid off from his job, so I'm trying to be patient with him, but I'm worried that my credit will take a nosedive with the non-payments. I'd appreciate your advice.
Answer provided by
Answered on Apr 07, 2021
Johnny Puckett is a freelance writer and automotive expert. He has contributed content to a number of some of the largest online publications, aftermarket automotive manufacturers’ sites, and automotive informational sites. His experience in the automotive and information fields informs his writing at Jerry. His automotive interests bleed into his free time, where he enjoys modifying his favorite cars and woodworking.
“Unfortunately, there is no single solution in this situation that will save your credit. If your nephew has not missed many payments, the best option for everyone involved would be for you to help him get caught up. The hit to your credit for the missed payments would be minimal, your nephew would get back on his feet, and both parties would avoid any legal repercussions.
Selling the car to get out of the debt may be another option, but depending on how quickly the car sells, you may still have to pay out of pocket for some of the payments.
If your nephew’s situation is just completely out of control, you may want to seek advice from a bankruptcy lawyer. However, there are major consequences associated with bankruptcy and it should be your last option. “
Did this answer help you?
Ask us a question by email and we will respond within a few days.
Have a different question?
You can meet us at our office and discuss the details of your question.
Browse by topics
What others are asking
What happens if your insurance is cancelled due to nonpayment?
I missed two months of insurance payments. Will they send me to collections? Can I call to try and pay part of it?
Jun 14, 2021
When is it okay to settle an accident privately and when is it better to file an insurance claim?
I was involved in a minor car accident and my sideview mirror was damaged. The other driver is at fault and they want to pay for the damage out of pocket. When is it okay to settle an accident privately and when is it better to file an insurance claim?
Feb 22, 2021