Trading in a Cosigned Car

Reader question:

I bought a used car with my boyfriend as a cosigner, and then recently I bought another one, using the old car as a trade in. My boyfriend didn’t know about it, and now that he does he thinks it was a bad idea. Is their a way that I can…I don’t know, unsign the contract?


There might be a way, Rachel.

Having a cosigner on a car can make things more complicated. This is especially the case when you are the primary user of the vehicle and as such should be entitled to make all of the decisions about the car. However, since your cosigner is bound to the car and held responsible if anything goes wrong on your end, then it can’t be that way. It makes things a little harder whenever you have to sell or trade your car, but it’s necessary because that person’s name was on the contract for that car. It’s always important to talk with the cosigner before making any big decisions about the fate of your vehicle.

So, your boyfriend cosigned for the old car that you traded in, right? If that’s the case, then you also have to ask yourself–is his name on the title for that same car? Because if it is, then you’re good to go. The dealership where you bought your new used car can’t keep the car without the permission of both responsible parties, and that includes him. So, without his signature, that car really isn’t theirs.

Because of that, the contract you signed for the purchase and trade in is incomplete and you can still get out of it. If your name is the only one on the title, though, it will probably be a little harder and the car dealership can try to enforce the contract. If you do end up canceling it and giving the car back and getting back your trade in, you’ll probably lose the down payment that you made to purchase the car.

All this could be avoided, though, by being open and honest with your cosigner (and boyfriend) in the future.


Fashun Guadarrama.

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Austin Davis, consumer car repair advocate. "Hi there! I love to help people solve their car repair problems and I hope my site was helpful to you today. Thank you for stopping by."