Financing in Highspire>Question Details

Me&3, Other/Just Looking in Highspire, PA

Hello all, Trying to find some answers, on how can an auto loan I cosigned for not be counted as my debt?

Asked by Me&3, Highspire, PA Sat Oct 22, 2011

I have been pre-approved for a mortgage but it was lowered because of an auto loan I cosigned for, that is current however I don't pay the loan. It's being taking out of someone else banking account but it only has been for 6mos. However I called the auto loan company to see if I can be taken off they told me I can't. But the person I cosigned for is my husband which he and I have been separated for some time a long time. LO told me that I have to get a legal agreement saying that we are separated and that he is responsible for auto payment and it has to be done by an attorney, he said the underwriter would take it & up my loan. The problem is here in Pa I called an attorney and he said that is not legal for a separation here in pa. So my question is for one that would know about under writing I guess, what else can I do? Oh another thing when I called an attorney he said they don't draw up agreements like who is responsible for bills? I don't know, I am lost , confused Please help?

Help the community by answering this question:


Good morning Me&3,

1. In order for an Underwriter to exclude this debt from your obligations the payment would have to have been in place for 12 months or longer and supported with documentation to show the other party makes the payments (not you). Anything less than 12 months and the debt is counted against your income.

2. Your husband should refinance the auto loan out of your name immediately. If you are separated and potentially heading towards divorce, why would you want to be responsible for his debt? Consult an attorney for further advice on this legal topic.

Trevor Curran
Web Reference:
1 vote Thank Flag Link Mon Oct 24, 2011
Hi Me&3. Trevor answer is spot on.
1 vote Thank Flag Link Mon Oct 24, 2011
Sounds like you should consult with a divorce attorney about a "legal separation" and also see if your attorney can get an agreement for him to refinance in his own name and take you off, and also to protect you in the future, as if you now don't have a legal separation, then he might run up other debts that might affect you. Also you might want to ask the attorney whether you spouse would have to sign a quit-claim deed if he is still your husband. I think you have a lot of issues to clear up before you get more complications by purchasing a home without making sure you have a clear title.
Best, Terry Bell, Realtor, Santa Rosa, CA
(If you like my answer, please give me a thumbs up or best answer!)
1 vote Thank Flag Link Sun Oct 23, 2011
Have you checked with a divorce attorney. If you are separated but not legally, in most states you are responsible for your spouses debts.
If your husband gives you the last 6 months bank statements showing the auto loan is taken out of his account and the laon papers (showing it will be taken out of his account), then many underwriters would not count the auto loan against you.
1 vote Thank Flag Link Sun Oct 23, 2011
If you are a joint account holder then it is your debt... if you co-signed for it then if you can prove it is has been paid out of an account that your husband is on that you are not on, then it could be excluded from your debt ratio since you are only a co-signer. However your husband could also just refinance it into his name himself and the issue would be solved by that alone.
1 vote Thank Flag Link Sat Oct 22, 2011
Thank you all for answering my question! However my LO said it would have to be 12 months with prof (which I have 6 mos prof) anyways he didn't say anything about when we got a divorce that we had to show papers of him paying the loan or that he would be responsible for the bill. He said the underwriter would only take 12 months of showing he is paying.
0 votes Thank Flag Link Mon Oct 24, 2011
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