Legal Question in Bankruptcy in Indiana

Re: rights of a cosigner in a chap13 bankruptcy

When you co-sign a loan for something, regardless of the reason the other person doesn't pay (whether he's a deadbeat and not paying or filing for bankruptcy protection), you as the cosigner are on the hook to pay off the loan.

You can either pay it off yourself or file for bankruptcy protection. Alternatively, you can sell the motorcycle and use the proceeds to pay down the loan as much as you can and then pay the difference out of your pocket.

Your guy can reaffirm on the loan, which means he agrees to pay it, in which case your problem is solved, but I'm guessing he's not doing that or you wouldn't be writing in.

I'm guessing that's NOT the answer you wanted to hear, but that's the way it works.

This is why I advise people not to cosign loans for others -- unless they have the ability and desire to pay the whole thing themselves when cases like this arise.

Let me know if you have other questions.