I co-signed a loan for a carthat was later totaled in an accident,if the owner will not pay for it what is my liability?
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I co-signed a loan for a carthat was later totaled in an accident,if the owner will not pay for it what is my liability?
I cannot afford to pay for the car either. What can the company do to me? They don’t seem to be going after the person that brought the car. What should I do?
Asked on October 28, 2010 under Bankruptcy Law, Florida
Answers:
S.L,. Member, California Bar / FreeAdvice Contributing Attorney
Answered 13 years ago | Contributor
As a co-signer, you would be liable for the amount of the loan plus interest. You might also be liable for the deficiency which is the difference between what the car would have been worth had it been sold instead of being totaled and the amount owed on the loan. You could sue the person who took out the loan to recover the amount of a judgment against you obtained by the creditor.
Depending on the amount of the loan, if eligible, you might want to consider filing bankruptcy. it would be premature to file bankruptcy until the creditor obtains a judgment against you.
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