Advice from Nashville's leading Financial Aid Advisor Dave Ramsey
By Dave Ramsey
Financial Peace and
The Total Money Makeover
"I co-signed for ex-girlfriend’s lease!"
I was dating someone last year that I was expecting to marry. She was having car problems so I co-signed on a lease with her. Now we’ve broken up and she still has the car. So far, she’s made one payment and I’ve made one. We have a forfeiture agreement on the car where, if she didn’t make a payment by the end of the month, I could come get the car. Her parents have offered to buy her another car and she’s offering to just give me the leased car. She won’t tell me how much her parents are willing to give her for a new car. Our conversations have become pretty confrontational.
I’ve already got a leased truck. Why should I take on these payments as well?
Daryl in Huntsville, AL
Oh, no! You did two no-nos at once – a lease and you co-signed!
I would not take that car as fulfillment of the amount she owes. Morally, she should find out the buy-out amount, sell the car and pay the difference to the lender. If she doesn’t have the money, her parents could pay the difference, since they’re offering to buy her a car anyway.
The reality is that you’re going to have to take control of this situation. If she won’t take care of this right away, you’ll have to take the car, sell it and finance the difference. Let her know that if it comes to that, you’ll be coming back and suing her for whatever amount you had to finance.
The lender will call her once and then they’ll call you sixteen times because they know you’ve got the deep pockets. She’s not good for the money and they know that. That’s why they wouldn’t lend her the money in the first place without you co-signing.
Don’t let the car be repossessed either. They’ll take the car and sell it for less than wholesale and come sue you for the difference. I know you were just trying to help her, but you’re legally responsible now too.
What a great example of why you should never co-sign for someone, even if it’s someone you think you’re going to marry.