Can a co-signers car be repossessed in bankruptcy? 21 Answers as of December 15, 2011

My mother-in-law co-signed a car for me in 2005 and then in 2010 she filed for bankruptcy. She said that it wasn't included but ever since she did, I have been having trouble with my account. Yesterday the car was repossessed and they are telling me that I have to pay off the entire balance+repo fees in order to get it back. Where do I stand in this matter?

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Guardian Law Group PLLC
Guardian Law Group PLLC | C. David Hester
If you were current on payments they cannot repossess.
Answer Applies to: Utah
Replied: 12/15/2011
Steven Harrell, Attorney at Law | Waymon Steven Harrell
If your mother-in-law fled a Chapter 7 case, your car can be repossessed legally if you defaulted in making your car payments to the lender. If she filed a Chapter 13 case, the lender would have been required to obtain relief from the co-debtor stay in the bankruptcy court before repossessing the vehicle. If you co-signed the car note with her, the lender is required under O.C.G.A. section 10-1-36 to send you notice of the repossession. This notice must be sent to you within ten days of the auto repossession, and it must state that the lender intends to pursue a deficiency claim against you. The notice must also advise you of your right to redeem the collateral. You can also exercise your right to demand a public sale of the vehicle, if you give written notice to the lender. Once the vehicle is sold, the lender does have a right to pursue a deficiency claim from you if it complied with the notice code section described above.
Answer Applies to: Georgia
Replied: 12/15/2011
Indianapolis Bankruptcy Law Office of Eric C. Lewis
Indianapolis Bankruptcy Law Office of Eric C. Lewis | Eric Lewis
It is possible to repo the car if it is an "event of default" under your agreement with the bank/dealer. You may be able to get the car back by "curing" the balance (payoff) or by filing for Chapter 13 bankruptcy relief.
Answer Applies to: Indiana
Replied: 12/14/2011
Theodore N. Stapleton, PC
Theodore N. Stapleton, PC | Theodore N. Stapleton
Your mother's liability on the car will be discharged but you still owe on it. She should have told you to keep the payments current.
Answer Applies to: Georgia
Replied: 12/14/2011
Charles Schneider, P.C.
Charles Schneider, P.C. | Charles J. Schneider
You owe the money. It has nothing to do with your co-signor's bankruptcy.
Answer Applies to: Michigan
Replied: 12/14/2011
    Charles R. Nettles - Attorney at Law
    Charles R. Nettles - Attorney at Law | Charles R. Nettles
    It doesn't sound like you stand anywhere pleasant. A Chapter 13 has a Co-Debtor stay that would protect you and the Debtor. The Co-Debtor stay does not just disappear. The finace company on the car would have had to file a Motion to Lift the Automatic Stay and the Court would have had to grant the Motion before they would be able to lift the stay. If it wasn't included in your bankruptcy, then the burden of making payments shifts to you as does the responsibility to keep it insured. If you did not keep up with the payments or you let the insurance lapse, that is grounds to have the car repoed. I think you should talk to an attorney quickly who can sort out what happened here because there is so much that I don't know about your individual situation.
    Answer Applies to: Texas
    Replied: 12/14/2011
    Ryan Legal Services, Inc.
    Ryan Legal Services, Inc. | Kevin Ryan
    More than likely somewhere along the way you built up a delinquency in the payments due each month. This occurs when there is a history of paying late over the course of several months or a few years. Once the lender lost its co-signer guarantee on the loan, it may have been re-classified as a higher risk loan, and any past due payments could entitle the lender to accelerate the full balance due at their option. If you signed the original finance /loan contract, you are liable for any amount in deficiency on the loan balance, plus all the repossession fees/costs as provided for under your agreement. You should contact a bankruptcy attorney as soon as possible.
    Answer Applies to: Ohio
    Replied: 12/14/2011
    The Law Office of Darren Aronow, PC
    The Law Office of Darren Aronow, PC | Darren Aronow
    A co signor is still responsible for the full amount of the loan even after bankruptcy. If you are in default, then you must pay to get it back.
    Answer Applies to: New York
    Replied: 12/14/2011
    Law Offices of James Wingfield
    Law Offices of James Wingfield | James Wingfield
    In Massachusetts a car cannot be repossessed absent a payment default. If your car was repossessed and you were up to date on payments you should talk to an attorney immediately, it is likely the car can be recovered and that you will have a claim for damages under the Massachusetts Consumer Protection Act.
    Answer Applies to: Massachusetts
    Replied: 12/14/2011
    Law Offices of David H. Relkin
    Law Offices of David H. Relkin | David H. Relkin
    Unless a debt is listed in the bankruptcy schedules, except in very exceptional cases, it is not discharged. In any case, if she was only a co-signer, you would still be liable for the payments. At this point, you would best be served by buying the car at auction, for a pittance and then make a deal with the creditor. The only problem is that the creditor doesn't have to pay anything up to the amount of his lien, which after default probably went up to 24.99% plus fees, storage etc. It depends. You may never hear from them again.
    Answer Applies to: New York
    Replied: 12/13/2011
    Carballo Law Offices
    Carballo Law Offices | Tony E. Carballo
    The car was repossessed because you did not make the payments. It has nothing to do with the bankruptcy of the co-signer. Because of the bankruptcy the co-signer cannot be forced to pay any deficiency (difference between the amount received at the car auction and the balance of the loan plus costs of repossession and auctioning the car). However, the bank can come after you and probably will come after you for the deficiency. You cannot get the car back unless you pay what the bank is demanding from you at this time.
    Answer Applies to: California
    Replied: 12/13/2011
    Colorado Legal Solutions
    Colorado Legal Solutions | Stephen Harkess
    If you were current on payments, the car should not have been repossessed.
    Answer Applies to: Colorado
    Replied: 12/13/2011
    The Schreiber Law Firm
    The Schreiber Law Firm | Jeffrey D. Schreiber
    The lender was a creditor due to her status as a co-signer. Whether she listed them or not (and failing to do so is a violation of bankruptcy law), these days creditors find out that someone has filed bankruptcy. It appears she failed to reaffirm the debt. Since she did not do so, the lender can repossess the vehicle after the case closes, which apparently it did. You can get the vehicle back for the terms the lender has given you.
    Answer Applies to: California
    Replied: 12/13/2011
    Mauritz Van Niekerk, Attorneys at Law
    Mauritz Van Niekerk, Attorneys at Law | Christiaan van Niekerk
    If you were making the payments they could not have taken your car
    Answer Applies to: New York
    Replied: 12/13/2011
    J.M. Cook, P.A. | J.M. Cook
    If the filing debtor did not reaffirm the debt, then the bank can consider that a non-monetary default (depending on your loan docs). You will need to refinance the balance to pay it off as suggested.
    Answer Applies to: North Carolina
    Replied: 12/13/2011
    Ashman Law Office
    Ashman Law Office | Glen Edward Ashman
    Unless she committed a felony (and the penalty is revocation of her discharge, and 5 years in prison, plus a $250,000 fine) she had to list the debt on the car. Her bankruptcy was a default and left you holding the bag.
    Answer Applies to: Georgia
    Replied: 12/13/2011
    Heupel Law
    Heupel Law | Kevin Heupel
    A car cannot be repossessed just because a cosigner filed for bankruptcy. It is repossessed if you don't make your monthly payment on time. Thus, you will need to pay the outstanding balance.
    Answer Applies to: Colorado
    Replied: 12/13/2011
    The Law Offices of Kristy Qiu
    The Law Offices of Kristy Qiu | Mengjun Qiu
    If she was a co-signer, even if she put the car in bankruptcy and she was a principal on the account, they cannot repossess the car if payment is current. Therefore, my next question is, were you current on the car payments? If you fall behind, even just for a month or two, they can repossess your car without notice if that's what's stated in the contract.
    Answer Applies to: Florida
    Replied: 12/13/2011
    The Stockman Law Office | Mary Stockman Esq.
    Your vehicle should not have been repossessed if you are making the payments. If you are not then the lender has the right to repossess the collateral.
    Answer Applies to: Florida
    Replied: 12/13/2011
    Janet A. Lawson Bankruptcy Attorney
    Janet A. Lawson Bankruptcy Attorney | Janet Lawson
    See a lawyer now. They can't pick it up if it was current. Not every lawyer is aggressive enough to handle this so keep looking until you find one that is.
    Answer Applies to: California
    Replied: 12/13/2011
    Law Offices of Joseph A. Mannis
    Law Offices of Joseph A. Mannis | Todd Mannis
    When she filed, she (ostensibly) received a discharge, and therefore, her obligation to pay this debt was gone. That left you as the sole person responsible. If they didn't receive payments, they will repo it, which they did, and the only person to go after for the funds would be yourself. Sorry to be the bearer of bad news, but unfortunately, that's where you stand right now.
    Answer Applies to: California
    Replied: 12/13/2011
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