Co-signer deceased
2 years ago an elderly woman that I helped take care of and I worked for her co-signed for me and my fiance to get a 4 wheeler. We have never missed a payment and Honda will say that we have perfect standing with them.
About a year ago the elderly lady passed and now her daughter wants the 4 wheeler or pay them for the remaing balance to get it off her credit, but we pay our notes. She is threatening to sue us if we don't give her a check asap. We still have a couple of years left and wanted to just finish paying it. I don't believe that Honda finance will entertain this but is there anything she can do?
I don't want my credit ruined for this. We just bought a house and we're trying to get our life started without all of this going on.
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Co-signing is not the same as owning. If your elderly lady didn't make any payments on the loan, and isn't on the ownership of the car, and there was no agreement that you would pay her anything, then you do not owe either her or her daughter any money.
Also the loan is not affecting the daughter's credit, and the mother's credit is irrelevant (since she is dead). However you should be aware that the finance company will want to know about the demise of the mother, since they can no longer make a claim against her if you default.
I would start by approaching the loan company, telling them about the mother's death, and asking to refinance in your name only. If you've really been keeping up the payments well this could be OK with them. If not I would find someone else who is prepared to co-sign a new loan with you, and still refinance. Then just tell the daughter that the loan her mother co-signed for has been discharged, and there is nothing for her to worry about.
People act like lawsuits are the end of the world, her suing shouldn't be considered a threat, it should be considered the accurate course of action to resolve contractual obligations.
Of course, it would be convenient if she did nothing at all!
If you believe her real goal is to "get it off her credit", then have her come refinance with you. This will give you the opportunity to not have her on it and you to get different terms. Of course, if your credit still is poor then this option also exacerbates the inconvenience. None of the options sounds like they will ruin your credit (unless you are scrounging for cash through credit facilities to pay her off).
You have several completely benign options available.
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