Car rights cosigner dies

by Emma
(Laredo tx)

My husband was the cosigner on the car loan and my son is the main borrower but my husband had always paid the note for his son car for college he is a full time student and now we can't afford to pay the car note will this affect my son as the main borrower on the loan or , or can we voluntary reposed the car due to my husband just recently passing away and he was the only person bringing in the income to pay the car loan please give me advise.

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Apr 13, 2012
Car rights cosigner dies
by: Debtcollectionanswers

So sorry about the loss of your husband. I know these must be sad times for you.

If your son falls behind on the car loan, then his late payments are likely to show up in his credit histories and damage his credit. Therefore, giving the car back to the lender is not a bad idea, although the fact that he did may also show up as negative information in his credit files. Even so, it would be better to voluntarily give the car back than to have it taken back by the lender.

If your son does give the car back, he should ask the lender for some concessions given that he has saved the lender the cost of repossessing it. For example, he may want to ask the lender to forgive any deficiency -- the difference between what the lender will be able to sell the loan for and the total amount your son still owes on his loan and to agree not to report the voluntary repossession to the credit reporting agencies. If the lender agrees to any concessions, your son should get them in writing before he gives back the car.

If your son does end up with negative information about the car loan in his credit histories, remember that that information will not stay there forever. Negative information can be reported for only 7 years and 6 months from the date his loan first became delinquent. Also, as time goes on and the negative information gets older and older, it will become increasingly less important to creditors and anyone else who might make a decision about your son based in part on his credit records. This assumes of course that he manages responsibly any other credit he may have now and any new credit he may get in the future.


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