#Cosigning #CreditAcceptance #FinancialAdvice
Hey there, community! 🌟
So, I recently found myself in a tricky situation and could really use some advice. I was coerced into cosigning for a car, and now I’ve received credit acceptance mail asking for thousands of dollars. Yikes! 😬
Here’s a quick rundown of my situation:
– I never agreed to be financially responsible for payments on the car
– My sister, who I cosigned for, assured me I wouldn’t have to worry about it
– I am struggling to make ends meet as it is and cannot afford this unexpected expense
I’m feeling terrified and overwhelmed. Is there anything I can do in this situation? I truly appreciate any insights or advice you can offer. Thank you in advance for your help! 🙏🏼
You are financially responsible for that car loan. That is what you do as a cosigner.
You will need to encourage your sister to make her payments, make them yourself, or take the hit to your credit.
You can pay it and then sue her in court for failing to uphold her end of the agreement. I hope that you have this agreement on writing.
Unfortunately, as a co-signer, as far as the bank is concerned you are just as liable as she is for the payments on the car; it’s the whole point of having a co-signer. (The dealer should have given you a brochure explaining this.)
Do you know if the car’s been repossessed? If it hasn’t, do you know if you are on the title, or just the loan?
If you get sued over this debt, *do not* ignore it; states have standards for when they are allowed to do things like garnish paychecks, and if you truly are living hand-to-mouth, there’s no money to take.
Unfortunately, if she was put into credit acceptance Corp. as a funding source, that is a last resort for dealerships to use for someone with the worst credit possible. So none of this is a surprise. Reach out to them and work out a payment plan.
Nothing here is coercion. You and your sister are equally responsible for the car loan.
I’m sorry, a cosigner is just as responsible for whatever they cosigned for as the primary debtor is.
They can sue you, and they like to go after cosigners because they know cosigners usually have more money and more credit to want to protect.
Is this reporting negatively? How many missed payments?
Op, you were not coerced to do this unless both your sister and mom made threats to get you to sign. What more than likely happened is they both asked you to sign by means if begging, pleading, and promising to pay on time. You admit you have a history of co-signing for your sister so I’m sure you felt okay doing it again, but not threatened to do it.
You owe this debt just as much as she does. If you don’t pay it, they will hold you accountable for the balance. You should know this since you have co-signed before. If anything, you can pay this and turn around then to sue your sister up to the max of the debt or what small claims court allows.
Have you informed your mom of this and if she can help? Has the car been repossessed? If not, call up the dealership and tell them where they can pick up the car.
Good god. This “isn’t the first time you’ve co-signed”? Go check your credit. Maybe if you’re lucky she’s defaulted on those also in the past and you don’t have to worry about this destroying your credit.
You also didn’t get coerced, you made a grown-up adult decision to co-sign . No is a very powerful word and that’s all you had to say.
Unfortunately, so many people think that co-signing means you think that the other person is a decent person who really needs a car. Co-signing means you’re equally responsible for the debt. The agreement with your sister is not legally binding. The agreement with credit acceptance is. Your best bet is to call them and work out some sort of payment plan, and also call your mom and sister and ream them out and try to get some money off of them. You might also try to pick up a second job or extra hours…
You weren’t coerced. You made a poor financial decision and every bit of language you used was a way to get out of your own bad decision making process… which you cannot. You owe $9k on a car that isn’t yours now and by the sounds of it, it won’t be your sisters for very much longer either. I owe $20,000 on a car that I cannot even drive and will continue to make payments on it because my grandmother was the co-signer and I do not want to put her in the same situation as yourself.
Credit acceptance is one of the most sleazy “banks” I have ever seen for sub prime lending. When they were trying to be on board with the old dealer I worked at they were bragging that they approved people with as little as $600 provable income. Rate was always 29.9%
I know you don’t want the responsibility but assess value of the car and GET THAT THING SOLD AND PAID OFF for the love of all that is holy
Call them. You need to talk to them. Find out exactly what is going on. Has the car been repossesed? Are they trying to repo it? (If it hasn’t already been repoed they are definitely trying to repo it, I’ve worked with CA before in repossession).
If they have not already gotten it, you can actually give it to them since you are on the loan. Depending on the state, after they get the car they will auction it off and you and your sister will be responsible for what is left owed. Once this happens, make a payment implant with them, and pay it. You can look into sueing your sister after the fact if you want.
In the future, do not co sign for something you cannot afford the payments on, and open the mail that comes to your house about financial obligations you have.
NAL, but worked in repossession for 7 years.
As a car salesman, I’m tired of seeing this. Parents who can afford a car, cosigning to get their kid a good rate is one thing. This sounds like two people who had no business anywhere near a car loan based on credit/income, considering OP can’t pay their own bills. This isn’t a situation where the dealer lied for you, sub-prime lenders verify everything. If you were over 50% DTI at the time of signing up for a payment, the bank broke the law. Santander literally surrendered cars and titles to consumers a few years back over this type of predatory lending.
If you’re just seeing the balance and it’s $9K, then I’d just encourage her to pay and hope she does because you’re tied to her on this.
If you’re seeing the $9K on a demand / collections letter and she isn’t making the payments on her own you should encourage her to hand the keys to the loan servicer as a voluntary surrender. It will go down as charged off debt and hurt both of your credit but you’ll save the $9K. They may continue to collect on the difference between the $9K and what they get at auction but they really never get any of that money after repo and if it were me I’d tell them I wasn’t paying after they took the car. Making some payments, remaining delinquent or going in and out of delinquency and eventually having it repossessed just drags out the hit on your credit rating and adds time before it finally falls off your report. Better to hand it back and now and take it as a lesson assuming you / she can’t borrow money from family.
Stop calling your sister and telling her to pick up the mail.
Go to her house and say “I’m getting notices you aren’t paying this bill. Why aren’t you paying it. Start paying it.”
If she says “I can’t pay it” then you say “Sell the car and pay off the loan”
If she says “but I need transportation” then you say “Sell the car, pay off the loand and buy a bus pass”
If she says “no” … well you’re kind of screwed. Sorry, but there’s a reason everyone says not to cosign for others.
>coerced
I don’t think that means what you think it means.
OK, as others have commented, you are legally liable for the loan. That’s the bad news and only part 1. The coercion is real and has some legal merit, but it is weak and tenuous, so let’s leave that alone for now and come back to it later.
Your sister is apparently behind in her payments. You as the co-signer are being notified. The lien holder is required to send the notices before they try to repossess the vehicle. But that is their main recourse, to take the car. The borrowers (including you) might have to make up the difference.
I’m imagining she didn’t put down a lot of money for the car, so the car may be worth less than the loan. Still you probably want the car to get repossessed. There are alternatives. She could see the car and pay off the loan, but she won’t do that.
You have a lot of legal options — that frankly are not worth it IF the car is worth 7000+ and all that will be left is approx 2000 of debt. (One thing is you might be able to argue about the Fair Market Resale Value or it might not be worth the lenders time to go after you for the remainder).
Your sister and your mom are both legally liable to you for the promises made to you (promissory estoppel), other legal doctrines as well, but you probably don’t want to sue your family if you don’t have to. I am assuming that mom either can’t or won’t bail your sister out.
Don’t panic. But DO NOT pay a penny. Let the car get repossessed, the sooner the better.
If you think the car is worth more than 9k, you may want to encourage the sale or try and force the sale (frankly, unlikely).
Lastly, I assume she is the only registered owner and that you are not on the insurance? These are good factors if you ever need to argue the more difficult arguments to be protected from the repercussions of this loan.
You can also Google predatory lending auto sales for your state.
Good luck!
You’ve just learned an expensive lesson. Don’t co sign for people….like ever. Not even for your own children.
I’m sorry you’re in this situation. Some posters have been harsh here. I feel like you were pressured by your family to co-sign and felt that you couldn’t say no? I understand that but unfortunately it makes little difference to the lender. Regardless of the situation if you signed the document you are responsible for money owed. Good advice from other’s call them yourself and find out exactly what’s going on. I doubt your sister will be honest with you. If the car hasn’t been repossessed take the steps to get that process started. This will cause conflict with your sister. Don’t worry about that. Think about yourself as that’s what your sister is doing. Good luck.
From the legal perspective, by cosigning you agreed that if your sister was unable or unwilling to pay back the loan, that you would pay back the loan yourself. It appears that is what your sister did, and now the lender expects you to make good on your commitment.
Just some personal advice. Lenders are experts at determining whether they can actually make money from giving out a loan. If they determine that the risk is too high, the chances your judgement of their ability to repay the loan is unlikely to be better than the lender’s.
NAL
So over 2000 years ago someone wrote in a very popular book, “Stand surety for no one”. Expensive and disheartening lesson. Now you are out of $9,000 and will have to cut ties with your thieving mother and sister.
Legally, you owe the money on the car just as much as your sister does.
If she still has the car, you might be able to work something out with her where you get the car in return for paying the rest of the bills.
You’re going to want to call the debt collector sooner rather than later, and negotiate with them. They’ll rather take a reduced payment sooner rather than who knows what later.
If you don’t have the cash for this, you could consider taking out a personal loan to get it. If you have anything of $5k+ in value for collateral—jewelry, your own car—you can get a better interest rate. You’d probably get the best rate on a loan like that by talking to someone in person at your bank.
That’s the whole point of being a cosigner. If she doesn’t pay, then you are liable as well.