Please Help - Co-signed Vehicle

[aviv]

What is the name of your state (only U.S. law)? Ohio

I am the co-signer on a loan from American Honda Finance. My ex-boyfriend and I signed a loan for a car and both of our names are on the title. We had a falling out, and he missed several payments, destroying my credit. I have asked him to refinance the car in his name or find another co-signer, and he has agreed to do so, however we are not on good terms and it doesn't appear that he's made any effort to take me off the loan. Is there any way that I can protect my credit? I want my name off the title of the car and off of the loan. I don't have possession of the vehicle, I've never driven it. I made the initial down payment and he paid me back. He misses payments and tells me he can't afford to make them occasionally. He recently purchased a motorcycle (paid in full) and went on a vacation to Jamaica.

Is there ANY way that I can detach myself from this vehicle and loan? Please help.

 

[Zigner]

Pay off the loan and the sue the ex for the amount you are out.
It will STILL show on your credit report, but at least you won't have any further negatives.

 

[seniorjudge]

Pay off the loan and the sue the ex for the amount you are out.
It will STILL show on your credit report, but at least you won't have any further negatives.

And, if your name is still on the title, go get the vehicle first before you pay it off.

Notify the cops before you get it.

Have the title (or a copy of it) so when you get stopped, you can show the cops.

 

[Slammedtgs]

As the previous posters have mentioned, the only thing you can do to prevent further damage to your credit is pay off the loan, and take possession of the car. I don't know that you would be able to sue your ex for the cost of the loan, since you legally agreed to assume responsibility for the payments when you co-signed. unless, of course you had an agreement that he would pay 100% of the note. (that though is between you and him, the bank doesnt care)

This may not be the best course of action, but you could pay off the loan, and sell the car (would need him to sign the title though) - probably would cause you a loss. Or you can pay off the loan and sell him the portion you own, at 50% of the purchase price. However, unless you have an agreement he would pay 100% of the note, you are responsible for the full amount if he defaults further.

Sorry about the bad luck

 

[aviv]

Let's assume I had the funds to pay off the loan. Here's my dilemma:

1) I can't take possession of the car. My ex has possession and will not allow me to take the car because our original agreement was that I would make the $5,000 down payment, he would pay me back, and he would make the rest of the monthly payments on the car (on time). It was supposed to be our shared car, but we ended the relationship and I never drove it, and it became "HIS" car. He only sees it as "his car" and doesn't understand that a joint account on the loan and both of our names on the title makes it 50% my car.

2) I would love to sell the car. I can't get to it, I don't know what's wrong with it (he may have encountered more accidents with the vehicle). He also would never sign off on the title. And I was told by the loan company and the bank that I can't take my name off the title until the vehicle loan is paid.

3) I'm interested in the last suggestion, however. If I pay off the rest of the loan on the vehicle, and have him sign a contract stating that he will pay the amount I paid on the car, I could sue him if he doesn't pay because I'll have documentation. Best case scenario: he does pay.

4) He's moving in a year or two. What legal issues will I run into if the car isn't paid off by the time he moves, he stops making payments, and I can't get ahold of him? What if I'm forced to pay off the rest of the loan to save the remainder of my credit? We had an agreement that he would make all payments, but I have nothing in writing.

 

[Slammedtgs]

Whether or not your ex sees the car as split ownership doesnt really matter.. You and he both have rights to the car. You can just go and take the car, its not stealing because it is in your name.. If you are being help financally responsible by the bank, you have an ownership interest in the vehicle.

It would be wise to let the police know, so that in the event he reports it stolen they know whats going on. However, since his name is also on the title, you can not stop him from using the vehicle. (You can take it without penalty, but cant stop him from taking it back)

It may be best to talk to a lawyer who is familiar with this. All I really know is that all the bank cares about is getting their money, they dont care from who.

Maybe asking to see if the bank would repo the car and liquidate it. (not sure that they would). This would still be bad for your credit score
Bankruptcy may also be an option - likely the worst, by damaging your credit further.

 

[aviv]

What about a contract?

I would first like to thank everyone for their feedback. Your legal advice is greatly appreciated.

I did ask about repossession. My understanding is that it would severely damage my credit history, far worse than its current condition. I'd like to stay away from that option. Also, I do not have keys to the vehicle.

Will this work: have him obtain a loan for the remaining amount of the vehicle. That money won't go directly toward the vehicle, so it won't be a refinance so he won't be incurring the extra monthly charges. I will pay the remaining total on the vehicle. He will pay me the money he received from the loan he took out. I sign over the title to him. Everything gets documented in a contract (that when I pay X amount of dollars on the car, he agrees to reimburse me the day of the transaction, and I agree to then sign over the title of the vehicle). Maybe I should also include what will occur if he fails to pay (I take him to court for the money).

Thoughts?

 

[Zigner]

That makes NO sense. If he can get a loan to pay you the full amount of the car, why wouldn't HE just pay the car off?

 

[Slammedtgs]

First let me say that you can get keys made from any Honda dealer in the USA. All you need is the VIN number and proof of ownership (and photo id) - loan documents would work for this.

You are thinking in the right track, make a contract for everything from this point forward. Written documentation is the best when you go to court. An agreement that he is to obtain a loan, pay you in return for you paying off the loan would work. Also, it would be wise to include a clause that if he breaches by not paying you that he forfeits hit right to ownership. Should he breach then, you will have ownership in the courts eyes.

This is probably the best idea yet, since if he simply refinanced the car you would still likely have liability to pay if your name is on the title.. Not sure about the terms.. Surety/secured debt. But the bank would likely come to you for payment.. Assuming he trust you, try it out

Good luck

I would first like to thank everyone for their feedback. Your legal advice is greatly appreciated.

I did ask about repossession. My understanding is that it would severely damage my credit history, far worse than its current condition. I'd like to stay away from that option. Also, I do not have keys to the vehicle.

Will this work: have him obtain a loan for the remaining amount of the vehicle. That money won't go directly toward the vehicle, so it won't be a refinance so he won't be incurring the extra monthly charges. I will pay the remaining total on the vehicle. He will pay me the money he received from the loan he took out. I sign over the title to him. Everything gets documented in a contract (that when I pay X amount of dollars on the car, he agrees to reimburse me the day of the transaction, and I agree to then sign over the title of the vehicle). Maybe I should also include what will occur if he fails to pay (I take him to court for the money).

Thoughts?

 

[Zigner]

First let me say that you can get keys made from any Honda dealer in the USA. All you need is the VIN number and proof of ownership (and photo id) - loan documents would work for this.

The key may need to be programmed to match the car. Can't do that without the car

 

[Slammedtgs]

That makes NO sense. If he can get a loan to pay you the full amount of the car, why wouldn't HE just pay the car off?

paying the car off does not removed her name from the title, she doesn't want anything to do with the vehicle - she has not even driven it. She wants to get her money back, and surrender her portion of the vehicle to him. There is more involved than just the bank getting the money owed to them

 

[Zigner]

paying the car off does not removed her name from the title, she doesn't want anything to do with the vehicle - she has not even driven it. She wants to get her money back, and surrender her portion of the vehicle to him. There is more involved than just the bank getting the money owed to them

It can all be wrapped up in the same transaction.

 

[Slammedtgs]

The key may need to be programmed to match the car. Can't do that without the car

Depending on the year of the car, you are correct most dealers know the code that get programmed into the key.. If the system uses the T5 key, they should have it on file. I have had the local dealer do this from me several times when I work for an auto repair shop

But, it just depends on the year and system used in the car. Otherwise you need to bring the vehicle to the dealer and reprogram with a computer..(Worst case)

 

[Zigner]

Otherwise you need to bring the vehicle to the dealer and reprogram with a computer..(Worst case)

But she doesn't WANT anything to do with the car, does she?

 

[aviv]

Thank you both very much. And Zigner, to answer your question, it's because he hasn't done anything to pay the car off. He won't take initiative to resolve the problem because he's not concerned about his credit and isn't worried about how it's affecting mine. He's purchased a motorcycle (Paid in full), and taken trips out of the country. He won't pay the car off on his own.

I am looking for a faster, more reliable solution. That is why I suggested that I pay the car off and have him sign a contract, because I think that if he feels he may lose his car he may be more inclined to cooperate. I feel that I need to be the one taking initiative in resolving the problem with the loan in order to resolve this whole matter more quickly.

Slammtgs - "Paying the car off does not removed her name from the title, she doesn't want anything to do with the vehicle - she has not even driven it. She wants to get her money back, and surrender her portion of the vehicle to him. There is more involved than just the bank getting the money owed to them "

Thank you. You know exactly where I'm coming from.

Now, if I could run the worst case scenario by you, what would have to happen if he breeches the contract? Lets say he doesn't pay me. I get keys made for the car, have the police escort me to the vehicle and I take possession. Is it illegal for me to retain the car for an extended amount of time? I understand it's 50% my car, but I'm taking away his transportation, so I can see him trying to sue me for lost wages and missing classes. Will I be protected if the contract states that I have the right to retain the vehicle until his payment is received into my account? What should I include in this contract to make it as solid as possible?