Legal Question in Credit and Debt Law in Virginia

Re: What are my rights as a co-signer?

As a co-signer, you have the right to be sued within the 5 year statute of limitations, and you have the right to have your defaulted debt remain on your credit report for 7 years.

Re: What are my rights as a co-signer?

I find not credible your claim that "the initial company never once contacted either party to collect and the collection agency has not either." They (the collection entities), at some time after the debt became due and owing on the part of the co-signers of the note, undoubtedly, in some way, shape or form, at the very least contacted your brother, but he, apparently, failed to communicate this very pertinent fact to you----for whatever reason. And yes, under the applicable law, you, as co-signor of the loan, are, unfortunately, responsible for all of the "unpaid enchilada".

Re: What are my rights as a co-signer?

The statute of limitations for the breach of a written contract is 5 years from the date of BREACH (when a payment was first missed or some other term was breached, not from the date it was signed).

You may be past 5 years or near to the 5 year anniversay of the BREACH (date of first missed payment). You may want to delay them until 5 years runs out.

If 5 years has expired, they can still sue you, and you MUST show up in court and claim the defense of the statute of limitations. If they don't have your current address or you just don't show up, you can STILL lose even outside the SoL.

However, the credit bureau can report anything they want for up to 7 years. I had a person contact me because the credit bureaus were reporting him as DEAD. There is very little you can do about this.

Technically speaking, of course, the credit bureau report is CORRECT. You are a co-signer on the loan, and the money is owed.

What perhaps you are saying is that there was an agreement with the company to settle the claim, such as by accepting return of the truck in exchange for dropping the debt.

WHen companies "write off" a debt, it usually just means that they count it as a bad debt and become discouraged about collecting it. However, that has no legal significance. THe debt is still owed, and they can choose to collect it.

However, if they AGREED to accept a lesser amount or the return of the truck in FULL satisfaction of the debt, then that agreement would be binding and final. The difficulty would be in trying to prove that that is what happened.