Girlfriend's gone, Mom's on the hook

Dear Debt Adviser: My mother signed an auto loan for my son's girlfriend. My mother is the only signer on the note, but my son's girlfriend is on the vehicle registration with her. The payments are up to date and the vehicle has been in the girlfriend's possession from day one. My son recently broke up with his girlfriend. Can my mother send a demand letter giving the ex-girlfriend 30 days to get the loan in her own name or, if not, personally repossess the auto? - Cliff

Dear Cliff: I needed to draw a chart to figure out who was related to whom! Oh, the joys of providing loans for those who have no business with one. The temptation to do what you can for those you love is very great and one to which we can all relate. The consequences of giving in to that temptation, especially when it comes to financial help, almost always turn out to be nightmares.

By the way, I noticed that you neatly dodged the bullet by your son going directly to his grandmother, thereby keeping both you and him off the hook. This sounds like it could be some male genetic trait in your family.

I'm surprised that your mother didn't see this one coming. My experience is that women usually are more perceptive than men in relationship matters. Had she thought it through and looked down the road to a likely breakup between her grandson and his girlfriend, she might not have made the same decision. We can't go back in time, so let's take a look at what options are available for your mother.

The fact that the payments on the car loan are up to date is great. The girlfriend is so far upholding her end of the bargain. The father in me wants to see you and your son take out a loan that will pay off your mom's note. There is no reason why she should be the one without a seat when the music stops in this game of musical chairs.

The trouble with having the girlfriend put the loan in her name is that if she did not qualify for a loan at the time the car was purchased, what are the chances that her situation has changed significantly enough to allow her to qualify for a loan now? You asked about a repossession possibility. I don't see one here.