Legal Question in Bankruptcy in Michigan

bankruptcy

I filed for ch7 10-06. I had both secured debt and unsecured debt. I was able to keep my house and my van which I was still paying on. However there was also a recreational vehicle (quad bike) that I had signed for for my son. Because his credit was not good enough to allow me to just co-sign for him, I had to sign for it straight up with him being shown on the loan secondary to allow for him to improve his credit score. When I filed for ch7 I was advised not to try to reafirm the debt for the quad bike and to surender the vehicle. I was told by my attorney that trying to reafirm recreational vehicles would throw up red flags that could possibly result in my ch7 not being allowed. So I surrendered the bike and my ch7 was proccessed with all debts filed for being discharged. The ch7 was discharged 1-07 and I thought all was good until recently my son has been attempting to secure a mortgage and discovered that the creditor for the bike started showing the loan as delinquet from day one after my ch7. Is this legal? As the bike had been surrendered as advised. And if this is legal how can my son rectify this problem? Also he had never been notified if there had been a shift of responsibilty for him to continue paying.


Asked on 9/04/08, 7:00 pm

1 Answer from Attorneys
Lesley Hoenig Lesley A. Hoenig, Attorney at Law

Re: bankruptcy

If your son is on the debt and he never filed bankruptcy and he surrendered the bike, nothing stops the creditor from filing derogatory info on the credit report. However it sounds like it should say "surrendered" not delinquent, unless they have a deficiency judgment against him, which would show up on the credit report as a judgment.

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Answered on 9/04/08, 7:07 pm


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