If I co-signed a loan for someone, canI sue them if they stopped paying on the loan?

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If I co-signed a loan for someone, canI sue them if they stopped paying on the loan?

I co-signed a car loan 4 years ago. She totaled the car and had no insurance. She stopped paying the loan and we both have judgements on our credit now. She refuses to pay any payments.

Asked on November 15, 2011 under Bankruptcy Law, Illinois

Answers:

FreeAdvice Contributing Attorney / FreeAdvice Contributing Attorney

Answered 12 years ago | Contributor

If you co-signed on a loan concerning a car for a friend where she stopped paying on the monthly amounts owed on the loan where a judgment has resulted against you and her, the only factual and legal basis for you to sue her under the agreement is for any money that you end up paying on the judgment against you.

Meaning, if you ultimately pay off the entire judgment against you resulting from the loan you co-signed for your friend, you can sue her for the amount paid under the theory of an implied contract between you two as well as accrued interest.


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