Co-signing for a leased vehicle...and it's returned

[Kevenswife2]

I know this is totally off topic and has nothing to do about Disney, but you guys have always been great at answering questions and I'm sure one of you can help me.

My 72 year old mom broke her on rule and co-signed so her boyfriend could lease a vehicle. Now they're breaking up (three months later, no surprise) and he may not be able to afford the payments. Mom says he can just turn it back in and walk away. I did a little research and discovered it will go down as a REPO on his credit report if he does this.

My question is, since my mom is the co-signer isn't she expected to pick up the payments if he can't make them? Also, since she did co-sign, won't it also effect her credit if he does turn the keys in and walks away?

Thanks for any comments!

 

[LoriKutchey]

This may help

http://www.consumerfinance.gov/askc...-asked-do-and-what-does-this-mean-for-me.html

 

[Kevenswife2]

Wow! Even HIS late payments can affect HER credit score! Since she told me about this yesterday, I've been shaking my head. She always told me to NEVER co-sign for anyone.

Thanks, that's a very helpful site.

 

[tvguy]

Wow! Even HIS late payments can affect HER credit score! Since she told me about this yesterday, I've been shaking my head. She always told me to NEVER co-sign for anyone.

Thanks, that's a very helpful site.

The key part of the phrase is "co". By signing you are accepting responsibility with the other person. If that person defaults, it is in the eyes of the law if YOU were leasing the car.

 

[GAN]

Look at the bright side -at 72, I'm not going to be overly concerned with my credit rating ..hopefully your mother can say the same thing. I figure most of my major expenditures will be over by then -maybe a car here or there but a few extra interest points on that wouldn't kill me. If it were someone younger, I'd be more concerned ....

 

[starry_solo]

It will count as a repo against the co-signer as well.

The co-signer will have to look at the repo laws in the state (also read the contract) to see if anyone would be responsible for any deficiencies in cost?

 

[Lisa loves Pooh]

Can she just afford to take it over?

 

[usnuzuloose]

She co-signed saying she would be responsible if he did not pay. That is why I do not co sign anything.

 

[seashoreCM]

In this specific case, your mom might be able to work out an early lease termination with a payoff fee that is not considered a repossession. But she will need to hold the keys and have custody of the car itself, if even for an instant as the car is driven back to the leasing agent.

Disney hints: http://www.cockam.com/disney.htm

 

[Eastern]

The fact that she broker 'her own rule' makes me think that she might not be thinking logically. I would have a serious discussion with her about her finances and see if there are other things that may be going on besides this.

 

[kymom99]

Do you think this man might have been a scam artist? She could try taking him to court

 

[dja14]

Please be careful. I have a friend who leased a car, lost her job and did a 'voluntary repo' (I didn't even know there was such a thing) The dealership sold her car as used (she had it a couple months so it was) for 12,000 less than her purchase price. They are now suing her for that plus all the fees.

 

[Colleen27]

My worry wouldn't be her credit. It would be her income. The finance company can come after her for any fees he doesn't pay, and they can and will go as far as garnishment orders against her income or bank accounts. Even if he does turn it in before racking up a bunch of missed/past due payments and repo fees, there will likely still be some balance owing in early termination fees and the deficiency between the bargain-basement price for which they'll sell it and what they deem the vehicle's value to be. If she is receptive, it would probably be a good idea to go over her finances and work out a plan for dealing with that eventuality.