Legal Question in Real Estate Law in California

Re: Co-Sign For A Home Loan

Only the lender can consent to removal of your name from the loan, and I highly doubt that the lender will consent. After all, why have a co-signer in the first place?

The favor you did for your friend will likely be with you for the life of the loan. Late payments will likely be reported to credit bureaus, which affects your credit history.

Never, ever co-sign for a loan.

Re: Co-Sign For A Home Loan

What exactly did your temporary agreement call for your friend to do? One doesn't get "taken off a loan" by the act of the co-borrower alone, unless the co-borrower pays off the loan, for example, by refinancing. Of course, no one will want to refi a delinquent loan in today's market.

Generally, the lender must proceed against the borrower and the collateral before taking action against the surety, but the surety (guarantor, cosigner, or whatever) can waive this right and others in signing the surety agreement, and many lenders insert various waivers.

So, it would be necessary to see the agreement you signed and look for waivers to see whether you are a prime target or merely a backup in case the borrower doesn't pay and/or a foreclosure results in a deficiency.

The rules on deficiency judgments are complex enough; figuring out the possible exposure of a surety to a deficiency judgment or a direct action on the loan is even more complex. A lawyer who knows the rules can look at your documents and give you an answer in 15 minutes, but a lawyer that doesn't know them could spend a day reading and researching and not come up with the right answer.