Question regarding liabilty for accident for car co-signer.

General Questions
#1

I am not asking for legal advice, for the record. I am hoping to settle an arguement.

My sister-in-law is the owner of a car. My wife is the co-signer on the car note(car loan).

Last week my sister-in-law as involved in an accident. She is automaticaly at fault as she was DUI.

My mother-in-law insists that my wife is in danger of being held liable for damages incurred by the person my wife’s sister hit, as she is co-signer on the car.

My wife lives in another state.
My wife is not involved in any way with the accident.

The only reason my wife is in this discussion at all is that she is the co-signer for the car loan.

Can the woman my sister-in-law hit sue my wife and claim damages from us?

(you are not my lawyer, consult a real lawyer, etc. etc… yes. I know all of that. I’m just trying to figure out if it’s something we need to do at this time. Thanks!)

#2

Your SIL is the registered owner.
YOur wifes only obligation is paying the loan. Neither your wife or the bank would responsible for the action of the registered owner.

#3

That’s what I figured as well, from my meager bit of legal reading.

Thank you Snnipe!

#4

Figured I would give this one bump for the Monday folks, and see if there are any conflicting viewpoints/opinions.

#5

I think your wife’s only hazard is being left on the hook for the full amount of the loan, if your sister-in-law decides to stop paying at some point. Since your sister-in-law is proving herself to be irresponsible, I’d be a little worried about that - your wife may need to pay for a car that your sister-in-law won’t willing turn over to her, if things go really badly.

As a side note, your family needs to watch more Judge Judy, to see why you never co-sign for ANYTHING. :slight_smile:

#6

What everyone else just said. The only thing I would check would be to make sure your wifes name is not on the title. It’s unusual to be the co-signer on an auto loan and not also be a co-owner of the vehicle. Even if it was the intention of the parties for your wife to have no ownership over the vehicle, I’d make sure that the dealership didn’t screw up.