If I co-signed my parents mortgage about 5 years ago but my mom lost her job and started missing payments, how can I best protect myself?

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If I co-signed my parents mortgage about 5 years ago but my mom lost her job and started missing payments, how can I best protect myself?

Due to this, my credit started to take a hit. I am considering filing Chapter 7 because my parents aren’t willing to sell the house for the next 2 years and I don’t want any further damage to my credit. I want to confirm that if I file for bankruptcy my name will still be on the mortgage, but if they miss payments and a foreclosure ensues, the bank cannot come after me since my debts were forgiven. Is this the best route to go if they are not willing to sell the house?

Asked on January 30, 2015 under Bankruptcy Law, Connecticut

Answers:

Anne Brady / Law Office of Anne Brady

Answered 6 years ago | Contributor

There is nothing you could do that is more damaging to your credit than filing for bankruptcy.  Plus the mortgage to your parents' house is a debt of yours that will be swept up into the bankruptcy.  You may very well not even qualify for bankruptcy, but if you do, it would be the worst possible thing for your credit and your parents.  The best thing you can do to protect your credit is to make your parents' house payment until they get back on their feet.


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