Can I Remove a Cosigner From My Auto Loan?
Circumstances can change (as we all know) and there may come a day when one or both parties want to remove a cosigner from an auto loan. The cosigner may no longer want the risk associated with guaranteeing an auto loan should the borrow miss payments or worse. Or, the borrower may have established themselves financially and no longer needs the cosigner. In these types of situations, it's often possible to remove the cosigner from the loan.
Here are some options to consider:
Request a Release
Some lenders will allow a cosigner to be released from a loan if certain conditions are met. You should contact your lender to see if this is a viable option for you.
If you are unable to request a release, you could always try to refinance the loan without the cosigner. This means applying for and taking out a new loan usually with a different lender. This could be an option if you have been making payments on time each month on your current loan.
Pay It Off
You can simply pay off the loan if you have extra money stored away or a received a tax return that would cover the payoff balance. Always make sure to call the lender and ask for a 10 day payoff amount so you don't underpay and be assured quick processing of the lien release.
Selling the car to cover the payoff is another option to be considered especially if you no longer need a car. If the car is not worth what your payoff amount is, this might not be the best option unless you have enough money to cover the difference.
If you are interested in refinancing a loan in order to remove a cosigner, AppCore can help. Fill out our secure online credit application today!