Will my foreclosure affect a co-signor? 16 Answers as of July 25, 2011

No, if I understand correctly, you co-signed on your sister's home and now you are losing your home to foreclosure. If that is the case, the foreclosure on your own home would not impact your sister's situation on the home you co-signed for her. The only way it may is if you were listed on the title on your sister's home and if your current lender who is foreclosing on your property is able to pursue a deficiency judgment against you. If so, then they can take further actions to recover from you which may include placing a lien against other property/ assets you own. But, if you're a co-signer on her loan and have no ownership in her property, and if the home you own that is being foreclosed upon is not using judicial foreclosure or otherwise cannot pursue a deficiency judgment, then this should not impact your sister.

It depends upon whether your mortgage company confirms the foreclosure sale and pursues you for a deficiency then it might affect your sister.

Yes, they take a hit on their credit report just like you will. That is the purpose of a co-signor, so the lender has 2 parties to go after.

Absolutely, your foreclosure will affect a co-signor. A co-signor is essentially pledging to be responsible for your debts if you default. In this case you are foreclosing, so the co-signor is responsible.

If you are a co-signer on a property you are liable for payment on the loan. If you have other property it is not liable for the loan.

A co-signor is only responsible for debts for which she co-signed.

As long as sister is able to handle her payments your foreclosure should not affect her.

Generally NO but they do look back to see if you preferred one creditor to another especially family. Consult with a Bankruptcy Attorney.

No, it should not affect her mortgage. You said you co-signed on her mortgage, but I assume you are not on her deed because if so, your foreclosure could result in a lawsuit and that could implicate any asset(s) that you have down the line.

If I understand this correctly, you co-signed for your sister's loan and this is not in foreclosure. However, a different property is subject to foreclosure. A creditor may only foreclose on collateral (a property) that is named in the deed of trust. If the second property is not collateral for the loan with your sister, this should not affect your sister.