What happens when a co-signer on a car loan files for bankruptcy?

Get Legal Help Today

 Secured with SHA-256 Encryption

What happens when a co-signer on a car loan files for bankruptcy?

My husband’s mother signed on our car loan and was listed as the primary buyer. She filed for bankruptcy recently. We were told that even if we make the car payments, it is voluntary and the car will not be ours anyway since the judge listed the car under her bankruptcy. Is this true under CA bankruptcy law?

Asked on November 29, 2010 under Bankruptcy Law, California

Answers:

M.T.G., Member, New York Bar / FreeAdvice Contributing Attorney

Answered 10 years ago | Contributor

If the car is technically her property and listed in the bankruptcy then yes, it may be true.  Have you been making payments all along?  Then I would see if there is a possibility that you can work this out with the trustee.  Maybe you can purchase the vehicle from the bankrupt estate or your mother in law can reaffirm the loan and take it out of the bankruptcy.  Consult with an attorney in your area on your options here as soon as you possibly can.  It appears that your interest may indeed be wiped out otherwise and all those years of payments made may go down the drain.  Good luck. 


IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although AttorneyPages.com has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.

Get Legal Help Today

Find the right lawyer for your legal issue.

 Secured with SHA-256 Encryption