Legal Question in Bankruptcy in New York

Re: Bankruptcy and a co-signer

A bankruptcy of one co-signer on a debt (such as a lease) transfers all responsibility for that debt to the other co-signer(s), so yes, your dad, if he co-signed, will be responsible for the debt. However, there is absolutely nothing that prevents the bankrupt co-signer from reimbursing the solvent co-signer(s) for the expense of paying the debt. Once a bankruptcy petition is filed, the solvent co-signer is prohibited from initiating any collections action (yes, even mentioning it at the dinner table) by the automatic stay (your dad can't come collecting to you), but once the bankrupt co-signer brings the subject up after filing the bankruptcy petition, the co-signers can work out something that will work for everyone in terms of getting a co-signer (your dad) repaid.

The way the debt would affect a co-signer's (your dad's) credit history is if the debt went unpaid after the bankrupt co-signer files for bankruptcy protection.

If you haven't hired an attorney to help you through your bankruptcy yet, you need to do so. Hire one who is geographically close to you and with whom you feel comfortable. Referrals may be available through your local county bar association or through the NYS Bar Association (www.nysba.org).

Good luck!

THE INFORMATION PRESENTED HERE IS GENERAL IN NATURE AND IS NOT INTENDED, NOR SHOULD IT BE CONSTRUED, AS LEGAL ADVICE. THIS POSTING DOES NOT CREATE ANY ATTORNEY-CLIENT RELATIONSHIP BETWEEN US. FOR SPECIFIC ADVICE ABOUT YOUR PARTICULAR SITUATION, CONSULT YOUR ATTORNEY.