My Ex-Spouse Cosigned a Loan – Am I Liable?

by Ron Haynes

I recently received an email from a reader who was concerned about a loan that her ex-husband cosigned with his nephew.

Hi, Ron. A couple of months ago, my ex-husband cosigned a loan with his nephew to help him get a pickup truck to use in his lawn care business. He hasn’t been able to get enough business to keep him afloat and my ex-husband is concerned that he will be forced to make the payments. (Yes, he and I still talk and are cordial with each other) I’m concerned that I may be held liable since he cosigned the loan while we were still married. Do you know if this is the case? –Jenn

Well Jenn, I want to encourage you to seek professional financial advice immediately. There are some details that are important in making a determination of liability. One of those details is in which state you live because you could be responsible, (even if you didn’t co-sign) if you live in a community property state.

Those states are:
1. Arizona
2. California
3. Idaho
4. Louisiana
5. Nevada
6. New Mexico
7. Texas
8. Washington
9. Wisconsin

If you don’t live in one of the nine community property states, you may not be legally responsible, and it won’t show on your credit report, but, please check with a financial professional before assuming this is the case.

There are only two ways for your ex-husband (and YOU if you live in one of those states) to get released from the obligation to repay the loan:

There is no magic way for your ex-husband or you to be released from the obligation to repay the loan, despite the claims of late night attorney infomercials. The finance company probably won’t change the terms of this existing loan agreement unless it is in their favor. Why would they? As it stands now, they have two people on the hook, potentially three if you live in a community property state. Two or three people have a better chance of coming up with the payoff funds than one.

I would recommend you and your ex-husband read The Federal Trade Commission’s guide on Co-signing A Loan. Living with a poor decision and working through it after the fact is one of those things we learn with experience…and one of the reasons I started The Wisdom Journal.

Of course it’s too late now, but for future reference, I recommend that you avoid cosigning any loan. When you’re asked to cosign a loan, you’re taking a risk that a professional lender won’t take. If the borrower met the criteria, the lender wouldn’t require a cosigner. Never forget that one fact.

I wish you the best and let me know if I can help in any other way.

[tags]loan exhusband community cosigned property state business cosign cosigning credit repay responsible state[/tags]

About the author

Ron Haynes has written 1001 articles on The Wisdom Journal.

The founder and editor of The Wisdom Journal in 2007, Ron has worked in banking, distribution, retail, and upper management for companies ranging in size from small startups to multi-billion dollar corporations. He graduated Suma Cum Laude from a top MBA program and currently is a Human Resources and Management consultant, helping companies know how employees will behave in varying situations and what motivates them to action, assisting firms in identifying top talent, and coaching managers and employees on how to better communicate and make the workplace MUCH more enjoyable. If you'd like help in these areas, contact Ron using the contact form at the top of this page or at 870-761-7881.

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Wow… Very unfortunate situation. I hope it works out for the best…


I think co-signing or guaranteeing a loan is even worse than borrowing, since you get the full obligation but none the benefits.

I am really shocked to hear that a 3rd party (who did not sign anything) maybe liable, like in the so called community property state.

There must have been a really good reason for having this law. I just can’t think of any.

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