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What happens if my car loan cosigner dies?
When I took out my car loan, I had just graduated from college and had close to no credit history, so my grandmother offered to be my cosigner. However, her health has been deteriorating and I’m not sure what will happen with my loan. What happens if my car loan cosigner dies?
Jack Walsh · Updated on
Reviewed by Shannon Martin, Licensed Insurance Agent.
It was very nice of your grandmother to be your cosigner. I’m sorry to hear that her health is deteriorating.
Fortunately, if your cosigner dies, your
car loan
shouldn’t be affected as long as you don’t have a history of missed payments. However, policies differ between lenders. You should review your loan agreement and contact your lender to confirm what would happen.
It’s also important to note that, if you don’t inform your lender, it could be considered a breach of contract and have more severe consequences.
If your payment history isn’t the greatest, you still have a minimal credit history, or a poor credit score, the lender could:
- Readjust your rate
- Require a new cosigner
- Close the loan and request the remaining balance be paid
Hopefully, her health improves, so you won’t need to have this conversation with your lender, but it’s smart to understand what would happen.
That said, if your interest rate is adjusted, you may want to consider refinancing the loan.
Jerry removes the hassle by instantly connecting you with top companies to meet your financial needs. Make sure you’re not overpaying for your car loan by comparing offers from multiple lenders to find the best option for you.
MORE: Does refinancing a car hurt your credit score?
View full answer
- Gregory R.
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