What Are the Options?
If the car loan you cosigned for is not in danger of default, ask the person if they are willing to try and refinance the vehicle in their name only. If things have changed in their financial life, this may be something they can do now but couldn't do before. Once the car is refinanced in their name only, you will no longer be responsible for the debt if they default on the loan or miss payments.
Some people may not be able to refinance due to their credit. That's probably why they asked you to co-sign in the first place. Or, they may be upside down in the car. What that means is that they owe more than what the car is worth and will find it hard to gain new financing. Others you co-signed for may be unwilling to try and refinance and let you bear the burden with them if they default on the auto loan. Unfortunately, if this happens, you are just as responsible for the defaulted auto loan.
Each state has different laws; however, if you find you are getting demand letters because the loan you co-signed isn't being paid, some advice I received from an attorney is this: You can try and take the person to court and argue that you don't have access to the vehicle on a regular basis. Since you did cosign and the loan and title is in both of your names, you have as much right to have access to the vehicle as they do. A court may side with you but you will have court costs and legal fees.
Another option might be to ask the person to sell the vehicle and pay off the loan balance. Again, this suggestion could be accepted or denied. If you own a vehicle of your own, you could also sell yours to pay the remaining balance due on the co-signed auto loan and take the vehicle. You have every right to do so say some attorneys.
There a very few ways you can get out of a co-signed auto loan so your best bet is to decline to co-sign in the first place. Friends and family members should be understanding of your concerns if you evaluate their income and expenses and decide they can't afford it; making you responsible. While the most favored option is not to co-sign, your best bet is to see if the person can refinance or find another co-signer. Remember, if the person you cosigned for does default, it can affect your credit score.