Legal Question in Credit and Debt Law in Texas
My son is considering chapter 7. He has a car loan that he cannot afford now and the insurance. The car is only worth around $7000. and the loan is over $9000. My question is that I am the cosigner of the loan would this be something he can do without it affecting me or even is he able to to it? Would this be a smart move or is there another option?
2 Answers from Attorneys
The bankruptcy would discharge his debt to the bank; however, you, as the cosigner, would still be liable for the debt.
Unwise..he does not keep the car and all he does is wipe out a debt which he can't pay. You remain on the loan and if car is repossessed your credit is destroyed for several years. Try to sell the car and arrange with creditor to pay off the balance at a lower rate..Bankruptcy for such a young person ruins credit for years..even though he starts anew..MY OPINION only...
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