How to Remove Yourself as a Cosigner

FEB 11, 2015

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You helped a relative or friend get on their feet financially by co-signing  a loan, but now you want to cut the monetary cord. Although each lender has its own rules and policies when you cosign, here are a few general guidelines on how to remove yourself as a cosigner without trashing your credit score.

What is Cosigning?

Whether you are co-signing for a student loan, car loan, credit card or mortgage, when you agree to cosign a loan you are promising to take financial responsibility should the primary borrower default on payments. This also means that any negative items associated with the loan will show up on your credit report, ultimately affecting your credit score. Examples of negative factors include late payments, missed payments or failure to make good on the account.

Removing Yourself from a Loan, Credit Card or Mortgage
The best way to remove yourself from a loan or mortgage is to have the borrower you co-signed for  refinance the loan  in his or her own name. Should the borrower show a history of on-time payments, income that can support the monthly payments and a favorable credit score, there is a good chance he or she can reapply for the line of credit in their own name.

Once refinancing is approved, you will be released from financial responsibility for monies borrowed and the influence over your credit report and score.

Another option you have to release yourself as a co-signer is to pay off the loan, mortgage or credit card balance and close the account. However, in some cases, when the primary borrower shows a history of on-time payments and a good credit score, you may be able to approach the lender about removing yourself from a loan, credit card or mortgage without doing so.

Unauthorized Co-sign on an Account
Scan your credit report for unfamiliar accounts; this could be a sign that your name has been added as a cosigner to a loan or account by a friend or family member, or, that you have become a victim of identity theft.  Contact the lender, and a lawyer with consumer law experience, for your options on removing yourself as a cosigner on unauthorized accounts.

Once you have removed yourself from a credit card, loan or mortgage, be sure to check your credit report to ensure that the account has also been removed from your credit history. However, the most important move you can make in agreeing to take responsibility for someone elses line of credit is to speak to the lender before cosigning on the dotted line.

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This article is provided for general guidance and information. It is not intended as, nor should it be construed to be, legal, financial or other professional advice. Please consult with your attorney or financial advisor to discuss any legal or financial issues involved with credit decisions.

Published by permission from, Inc., an Experian company. © 2014, Inc. All rights reserved.