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Can a cosigner be held liable for an accident?
As mentioned, cosigning an auto loan does not make you liable for what the primary borrower does with the car. You will not be held responsible for any accidents resulting from the driver’s negligent acts. However, you are liable for the loan payments, which could pose a problem if the driver is sued.
Is a co signer responsible for car insurance?
As stated earlier, as the co-signer, you are not required to be a part of the insurance policy. The primary reason of the co-signature is financial responsibility for the repayment of the car loan. However, you should make sure that the vehicle’s insurance payments are observed.
Can you sue a cosigner for a car loan?
When you agree to co-sign a loan, you can still sue the borrower for any reason — whether or not it’s related to the loan. The real question with any lawsuit is not whether you can file it but whether you can win. If you file a frivolous lawsuit, the borrower could come after you for attorney’s fees and court costs.
What’s the responsibility of a cosigner?
Co-maker or guarantor: Also referred to as cosigner, you guarantee the account and assume responsibility if the maker should default. You’re also making a legal commitment that you will be responsible for meeting the terms of the account if the primary borrower dies, loses a job or otherwise fails to make payments.”
What is a co signers responsibility?
A co-signer takes full responsibility for paying back a loan, along with the primary borrower. Often a co-signer will be a family member. The co-signer is obligated to pay any missed payments and even the full amount of the loan if the borrower doesn’t pay.
Are you liable for accidents if you cosign a car loan?
As mentioned, cosigning an auto loan does not make you liable for what the primary borrower does with the car. You will not be held responsible for any accidents resulting from the driver’s negligent acts. However, you are liable for the loan payments, which could pose a problem if the driver is sued.
Who is responsible for car insurance if co-signer?
Technically, co-signing affects only loan repayment. If the vehicle’s insurance is in your name alone, you are the sole driver and the sole car owner. You are solely responsible for all the costs that may arise from insuring the vehicle. The lender, according to the policy, is the lien holder.
Can a co-signer be sued for vicarious liability?
Vicarious liability means that by being a co-owner, you are partly responsible for any damages resulting from the driver’s actions. This means that in the event of an accident, you, the co-signer, can be liabile for an accident and as such, you could be sued.
Can a family member cosign a car loan?
You can cosign an auto loan for a family member or close friend. Generally, you are only responsible for the loan, not what the primary borrower does with the car. As mentioned, cosigning an auto loan does not make you liable for what the primary borrower does with the car.