What Happens To My Co-signers If I File For Bankruptcy?

Law

A co-signer is someone who helps with a loan. The co-signer is jointly responsible for the repayment of that debt. If the debtor fails to repay the debt, the creditor may sue the cosigner.

But, the question is, can a creditor pursue the co-signer (person not filing for bankruptcy) if the debtor files bankruptcy? This question is dependent on the bankruptcy chapter filed.

The co-signer is not protected if the bankruptcy is Chapter 7. The co-signer can be pursued by the creditor according to the terms and conditions of the original contract.

The co-signer of a Chapter 13 bankruptcy is protected as long the following conditions are met.

  • Consumer debt is a debt
  • The proceeds of the debt are not shared with the co-signer
  • The entire amount will be repaid by the Chapter 13 plan

The creditor can’t pursue the cosigner as long as the Chapter 13 debtor follows the required repayment plan.

Tenina Law has years of experience in bankruptcy law and can help you speed up and make the process easier. The best part is that they don’t charge for an initial consultation. If you don’t have the budget to pay a lawyer, this is something you should consider. In fact, many lawyers offer a free consultation.

A bankruptcy lawyer will also have the benefit of having experience with dealing with lenders and financial institutions that are involved in your bankruptcy. Although it may seem like the process is straightforward if you only have one lender to deal with, each lender has its own requirements and is unique. You can be sure that you will receive the best possible deal on your bankruptcy if you hire a lawyer who has extensive experience in these areas. An experienced bankruptcy lawyer will be able to explain the tax laws. Many people file for bankruptcy on the basis of debts they incurred while still working. An experienced lawyer can explain the consequences of tax liabilities and accountabilities. No matter what situation you are in, it is important that you consult a qualified bankruptcy attorney immediately.

This article was written by Alla Tenina. Alla is one of the best tax attorneys in Los Angeles California, and the founder of Tenina law. She has experience in bankruptcies, real estate planning, and complex tax matters. Click Here for more information. The information provided on this website does not, and is not intended to, constitute legal advice; instead, all information, content, and materials available on this site are for general informational purposes only. Information on this website may not constitute the most up-to-date legal or other information. This website contains links to other third-party websites. Such links are only for the convenience of the reader, user or browser; the ABA and its members do not recommend or endorse the contents of the third-party sites.

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