How to Remove a Cosigner from a Car Loan

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Adding a cosigner is one of the best ways that you can get approved for an auto loan, especially if it’s your first loan. Over time, as you get closer to paying off your loan, you may want to end up removing the cosigner from the loan. If you’re like many St. Louis drivers, then you might be wondering if it’s possible to remove a cosigner from your loan. Removing a cosigner from an auto loan is possible, and the finance team at Suntrup Automotive Group is here to show you how you can take the necessary steps to do so. Learn how to remove a cosigner from an auto loan, and reach out to us for any of your other car-buying questions.

Why Add a Cosigner in the First Place?

Many St. Charles drivers add a cosigner to their loan since it’s a great way to get approved, especially if it’s their first time getting a loan. Another reason drivers may add a cosigner is to make themselves look like a smart investment if they have bad credit due to missed payments. Adding a cosigner shows that someone else trusts you to pay back the loan since the cosigner is supposed to make the payments if you can’t make them or if you fall behind.

However, this creates a risk for the cosigner since their record will be negatively impacted if you fall behind on payments. So, even if you don’t want to remove the cosigner from your auto loan, your cosigner may end up wanting their name taken off of the loan.

How to Remove a Cosigner From a Car Loan: Your Options

Removing a cosigner from an auto loan is definitely possible, but you just need to know what your options are. Try contacting your lender over the phone to see if they will allow you to take your cosigner off of the loan. You’ll also want to discuss the following with your lender:

  • Refinancing the Loan: Refinancing means working out new loan terms with the same lender or another lending partner. If you’re able to refinance the loan yourself, then you’ll be able to remove your co-signer’s name from your auto loan. You might even get a better interest rate than your previous loan. You should consider this option if your credit score has gone up since you took out the first loan.
  • Cosigner Release: In some cases, your loan agreement may come with a cosigner release option. If you’ve made many payments on time, then some contracts will allow you to remove the co-signer’s name from the auto loan, eliminating their risk immediately.
  • Selling the Car & Paying off the Loan: If nothing else works, then consider selling your vehicle and paying off the loan in full. Doing this will immediately remove your co-signer’s obligation to the loan as well as your own. Keep in mind that this would only be in your best interest if you weren’t upside down on your loan, meaning that your vehicle is worth less than what you currently owe on your loan.

Now that you know how to remove a cosigner from an auto loan, check out some of our other car-buying tips at Suntrup Automotive Group. We’ll show you everything you need to know about car-buying, so you can shop in the Fenton with confidence.

Learn More Car-Buying Tips in St. Louis

Knowing how to remove a cosigner from a car loan is helpful, but do you know what to look for when buying a used car? Contact us for more helpful tips and advice or any questions you have, and we’ll help you out right away.

 

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