I have a now upside-down vehicle loan for which there is a co-signor. I'm wondering if the co-signor will be responsible if I go into bankruptcy.
Question Details: I just lost my job and can no longer afford the payments on my vehicle loan. The bank won't refinance since the loan is now worth more than the vehicle and the loan company refuses to work with me at all, even though I was in good standing until now. Is there ANYthing I can do that will alleviate the high payments and not hurt my co-signor? I've talked with the co-signor and he said that his credit union said it wouldn't hurt his credit if this happened, but I'm skeptical and don't want to make a mess of things. What is the right thing to do? Thanks in advance for your time!
I'm afraid that if you file for bankruptcy your debt on the vehicle will be extinguished (unless you reassume it).
This will indeed leave the company in a position where it will be able to pursue the co-signer up to the maximum contractual amount. Probably everything..
In short, you filing for bankruptcy won't affect your co-signer's credit, but he/she will be liable for everything with respect your joint debt after that. You alone must decide what the best course of action is!
David S. Hamilton, Esq.
Dwyer & Associates, LLC. NYC.
