Can a co-signor on a car loan report the car stolen if the other signer runs away with the car?

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Can a co-signor on a car loan report the car stolen if the other signer runs away with the car?

I am 18 and defaulted on my payment 1 month. My dad co-signed on the car for me and so the default affected his credit as well as mine. I am caught up on my payments now and this is the first and only time I have/will default. I am very good about making my payments on time, but because of this incident my dad has removed items out of my engine in order for the car to not start. I’m getting the car fixed and then taking it and continuing to make the payments. Is my dad able to report the car stolen? Does he have the right to sell the car without my consent?

Asked on April 13, 2012 under Bankruptcy Law, Missouri

Answers:

FreeAdvice Contributing Attorney / FreeAdvice Contributing Attorney

Answered 12 years ago | Contributor

The co-signor on the loan that you have where you have the main repsonsibility for making payments on it does not have the contractual or legal right to report the vehicle stolen if in fact it was not unless you have a separate agreement in writing allowing such. Likewise, the co-signor does not have the right to sell the car without the primary borrower's consent and the consent of the lender.

If you take the car that you are making payments on where you are the person primarily obligated under the loan for it, there is no theft of the car from a legal perspective.

The obligation of the co-signor lies lies with the lender where if you fail to nmake payments on the loan and the primary borrower, the co-signor then is required to make up the payments. If that happens, the co-signor can then look at you for repayment with accrued interest.

 


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