Can You Remove a Cosigner from a Car Loan?

Two people signing 

Congratulations! You're ready to move forward with a new vehicle purchase. Getting approved for an auto loan isn't always easy. But with the right help, almost any Manchester or Nashua driver can find a way to move forward with an auto purchase. Adding a cosigner can be a smart way to move forward, and it always pays to understand your options. 


Can you remove a cosigner from a car loan? You might have to pay attention to the regulations and paperwork, but the answer is usually yes! Restrictions and options vary from lender to lender. However, most lenders offer some means for you to adjust your loan or contract after you purchase your vehicle. 

Our guide from Audi Stratham helps you find out how to remove a cosigner from a car loan.

What's the Purpose of a Cosigner on a Loan?

Adding a cosigner offers a relevant way to shore up your auto loan application if you have bad credit. It also makes your loan look like a smarter investment, whether you decide to buy or lease. 

Here's why: 

  • If your credit is low due to missed payments or a high debt-to-income ratio, adding a second name to the dotted line proves that someone else trusts you to pay back the loan. 
  • A cosigner creates a protective buffer for the lender because the partner is supposed to step in and make payments in the event that you fall behind.
  • One thing to be careful of is that the process also creates a new financial risk for your partner. If you fail to pay back your loan or end up missing payments, it will leave a negative mark on their record and not just yours. 

Even if you're always on time, you or your partner might still wonder how to remove a cosigner from a car loan. After all, the amount of debt in their name could prevent them from taking out another loan or moving forward on a project nearer to their heart.

How to Remove a Cosigner From an Auto Loan

Removing a cosigner from an auto loan is almost always possible. The first step is to contact your lender by phone and talk to a customer service specialist. 

Discuss the following options with your lender:

  • Refinancing Your Loan - Refinancing means you work out new loan terms with the same lending partner or a new auto loan company. In the event you can refinance your auto loan by yourself, your cosigner's name won't have to be on the loan. You could even secure a better interest rate because you've been on time with your loan to this point. Try this option if your credit has gone up since you initially took out the loan.
  • Cosigner Release - Go over the fine print of your loan contract. See if there's a cosigner release option for you to look over! If you've made enough payments on time, some contracts will let you remove the cosigner's name and eliminate their risk as soon as you can. 
  • Sell the Car and Pay Off Your Loan - If all else fails, you might decide to sell the car and pay off the loan in full! Although this is only a good option if you're not currently underwater on your car loan, doing so will immediately remove your cosigner's (and your own) obligation.

Test Drive Your Next New Vehicle at Audi Stratham!

Now you know if you can remove a cosigner from a car loan in Stratham. Ready to move forward? Contact us to schedule a test drive. We're happy to help in any way we can! 

Look over our new vehicle specials to see if you can save some money on your purchase. We think you'll be impressed with several vehicles on our lot.