Legal Question in Bankruptcy in California
Co-signer
My dad co-signed on a car for me and I have remained constant on all my payments and have never been late, nor do I want to put the car loan into the Bankruptcy; however I do have credit cards that are eating me alive and want to file for BK to eliminate those debts and start fresh, how will this affect my Dad?
1 Answer from Attorneys
Re: Co-signer
You will have to list your car loan as an obligation in the bankruptcy, as well as the car as an asset. If you wish to keep the car, you will be required to sign a reaffirmation agreement which is a new contract to continue paying on the car. That means that if you should again fall on hard times after the bankruptcy is over, the lender would have available all civil remedies, and the bankruptcy would not forgive any of the auto loan debt.
Because you are current, it should not affect your father. Before you file the BK, I would suggest that you talk to the lender's bankruptcy department and see how they would handle the situation.
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