Am I still responsible for the remaining amount even if the other person claimed it as their responsibility through bankruptcy? 22 Answers as of February 14, 2014

I co-sign for a vehicle about 8 years ago. the person defaulted on the loan. when I found out that the company was going to repo the vehicle the loan was 4 months past due and the finance company would not let me catch the payments up. The vehicle was sold at an auction for $17,000. That left $11,700. Myself and the other person agreed to split that sum in half and pay the loan off. I kept my word and paid half. the other person did not. The collection agency was hounding me about the other half. I found out that, the other person filed bankruptcy. The collection agency was working with me to make arrangements. Until they informed me that the other person filed the other part of this loan estimated $5,592 on their bankruptcy claim. So I was informed that the matter was resolved. Well that was almost 5 years ago and a couple weeks ago I got a notice in the mail that the collections company is demanding the unpaid balance once again.

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Indianapolis Bankruptcy Law Office of Eric C. Lewis
Indianapolis Bankruptcy Law Office of Eric C. Lewis | Eric Lewis
Generally speaking, you would still be responsible for the entire balance as the co-signer. You have not provided enough information to determine if the debt is collectible (i.e. within the applicable SOL). Bankruptcy discharges personal liability to pay debt; it does not get rid of the debt itself as to others who did not file for bankruptcy relief.
Answer Applies to: Indiana
Replied: 2/14/2014
Law Offices of Linda Rose Fessler | Linda Fessler
You are still responsible but if they never got a judgement against you, I am quite sure, depending on your state, that the statute of limitations has run and they cannot get a judgement. I would also go to my credit report and object to its being on your report. You will probably be able to get it removed.
Answer Applies to: California
Replied: 2/11/2014
Law Office of Shawn N. Wright | Shawn N. Wright
Just because the other person filed bankruptcy doesn't mean that your liability is wiped out. The issue here however is that if 5 years has passed since the other person filed bankruptcy, and you haven't been making payments since that time, then maybe the Statute of Limitations has passed and the car lender won't be able to prevail in a lawsuit against you. The laws regarding Statutes of Limitations depend on your state, so you should consult with an attorney as to whether or not you are still liable. In any event, you shouldn't ignore this situation, and you should seek legal advice, and bear in mind that the co-signer's bankruptcy discharge does not help you in any way.
Answer Applies to: Pennsylvania
Replied: 2/3/2014
Stuart P Gelberg
Stuart P Gelberg | Stuart P Gelberg
You are still responsible.
Answer Applies to: New York
Replied: 2/4/2014
A Fresh Start
A Fresh Start | Dorothy G Bunce
Well, now you see why Shakespeare said "neither a borrower nor a lender be." By trying to help out someone who wasn't financially responsible, you have made yourself the victim. The bankruptcy only resolved the co-borrower's responsibility on the loan. You remain 100% on the hook for the entire loan, plus legal fees and interest. This has been an expensive lesson for you to have learned.
Answer Applies to: Nevada
Replied: 2/3/2014
    Heineman Law Office
    Heineman Law Office | Jeff Heineman
    Technically, you are still liable despite what the collection person told you initially. An important question is how long ago was the default on the loan. If the initial default occurred more than 5 years ago, then the collector may be barred from collecting. If you receive something from the lender that states your account balance is $0.00, you could try to use that against it. However, that defense is not fool-proof.
    Answer Applies to: Idaho
    Replied: 2/3/2014
    The Law Office of Darren Aronow, PC
    The Law Office of Darren Aronow, PC | Darren Aronow
    Yes, you are "joint and severally liable" so you are responsible for the entire debt.
    Answer Applies to: New York
    Replied: 2/3/2014
    Kirby G. Moss PC | Kirby G. Moss
    A co-signer is just as liable for entire amount as original borrower, so yes they can pursue you for entire amount. The agreement with original borrower to split amount does not bind the creditor.
    Answer Applies to: Indiana
    Replied: 2/3/2014
    Mauritz Van Niekerk, Attorneys at Law
    Mauritz Van Niekerk, Attorneys at Law | Christiaan van Niekerk
    Yes the co dignity is liable.
    Answer Applies to: New York
    Replied: 2/3/2014
    Law Office of Lynnmarie A. Johnson
    Law Office of Lynnmarie A. Johnson | Lynnmarie Johnson
    If you co-signed for it, you are responsible for the deficiency. They can't go after he person who filed bankruptcy, so they are going to go after you. Unfortunately any agreements you made with your co-signer don't mean anything since they went bankrupt, so they are going to go after you, as the "deep pockets" who paid off the first half. Sorry.
    Answer Applies to: Michigan
    Replied: 2/3/2014
    Eranthe Law Firm
    Eranthe Law Firm | Cate Eranthe
    You are still responsible on a co-signed loan if the other party files bankruptcy. The more important issue is the statute of limitations to collect the debt may have run. Unless a judgment was taken against you then that won't be the case as a judgment can be renewed forever. You should see a knowledgeable local attorney who can advise you depending on the specifics of your facts.
    Answer Applies to: California
    Replied: 2/3/2014
    Law Offices of A. J. Mitchell, LLC
    Law Offices of A. J. Mitchell, LLC | A. J. Mitchell
    If you are a co-signer, you remain jointly liable for the debt. A bankruptcy filing by the other party does not relieve you of liability for the debt. Thus, the lender will most likely pursue you for collection.
    Answer Applies to: Georgia
    Replied: 2/3/2014
    Deborah F Bowinski, Attorney & Counselor at Law | Debby Bowinski
    The fact that the other party filed bankruptcy has no bearing at all on whether you still owe the balance. When you cosign a loan you agree to be responsible for the full amount if the other person does not pay. Having said that, you really should consult with a consumer debt attorney. You may have defenses to claim against the collection agency. There may be a statute of limitations issue if the debt is as old as you say it is, but that issue is very fact specific. Take all your records with you and consult with a lawyer to see what your best options might be.
    Answer Applies to: Colorado
    Replied: 2/3/2014
    GARCIA & GONZALES, P.C.
    GARCIA & GONZALES, P.C. | Richard N. Gonzales
    Check the Statute of Limitations where you live. In Colorado it is 6 years. The six years runs from the date of the last payment. Assuming the account is still active, they can still try and collect the obligation from you.
    Answer Applies to: Colorado
    Replied: 2/3/2014
    Janet A. Lawson Bankruptcy Attorney
    Janet A. Lawson Bankruptcy Attorney | Janet Lawson
    If the other person filed for bankruptcy, you are stuck with the debt, BUT in California the statute of limitations is only 4 years. After that they can't come after you unless they have a judgement.
    Answer Applies to: California
    Replied: 2/3/2014
    Goldsmith & Guymon
    Goldsmith & Guymon | Marjorie Guymon
    You are responsible for the entire amount of the loan, or deficiency, as a co-signer. Unfortunately, you cannot pursue the other co-signer since they filed bankruptcy.
    Answer Applies to: Nevada
    Replied: 2/3/2014
    Patrick W. Currin, Attorney at Law | Patrick Currin
    The statute of limitations is four years.
    Answer Applies to: California
    Replied: 2/3/2014
    Law Office of Jeffrey Solomon
    Law Office of Jeffrey Solomon | Jeffrey Solomon
    Co-signing a loan leaves you responsible for the entire loan, not just one-half. The creditor may collect the entire balance from you. However, from the facts you describe, you might have a statute of limitations defense, meaning the creditor waited too long to sue. You should consult an attorney.
    Answer Applies to: Florida
    Replied: 2/3/2014
    Fluhr & Moore, LLC | Steven S. Fluhr
    Because you co-signed the loan for the whole amount, you are responsible for the entire debt. The co-signor's bankruptcy merely discharged his obligation to pay the lender. It does not have any effect on your obligation.
    Answer Applies to: Missouri
    Replied: 2/3/2014
    Graves Law Firm
    Graves Law Firm | Steve Graves
    If you're in Texas, it all happened more than four years ago and you haven't paid anything or made any new promises within in the past four years, the statute of limitations in all likelihood bars suit against you. This new debt collector is probably a bulk debt buyer. I recommend you tell them to go jump in the lake. Do it by certified mail and tell them you're instructing them to make no further contact with you about the claim, as provided by the Fair Debt Collection Act. That usually works.
    Answer Applies to: Texas
    Replied: 2/3/2014
    Meister & McCracken Law Firm, PLLC | Joanne M. McCracken
    You may have some defenses in this matter but you should speak with an attorney who can advise you about being a co-signer and about statutes of limitation.
    Answer Applies to: Arkansas
    Replied: 2/3/2014
    Musilli Brennan Associates PLLC
    Musilli Brennan Associates PLLC | John F Brennan
    It would appear they are within their rights against you as a co-signor.
    Answer Applies to: Michigan
    Replied: 2/3/2014
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