Denita Posted July 28, 2008 Report Share Posted July 28, 2008 There is a car loan outstanding (no equity, car value less than loan). If the co-signer files a BK, how will it affect the other persons credit? The other person is a family member, but not a spouse. Will the TL read BK? Link to comment Share on other sites More sharing options...
borgman72000 Posted July 28, 2008 Report Share Posted July 28, 2008 I recently went through the same thing with my wife and FIL. FIL filed BK, but since we proved to the BK Lawyer that the car was in my wife's pocession, she is making the payments and is her only vehicle, it was not included in the BK. You'll probably have to meet with the BK Lawyer and fill out some paper work, but shouldn't be an issue. Link to comment Share on other sites More sharing options...
Denita Posted July 28, 2008 Author Report Share Posted July 28, 2008 Many thanks! I was worried the BK would end up on family members' cr rep 'by error' and she would have to fight it to get it removed! Link to comment Share on other sites More sharing options...
bingo Posted July 28, 2008 Report Share Posted July 28, 2008 I assume you intend to continue to make the payments. If not, the cosigner is on the hook for the balance and creditors will come after them. Link to comment Share on other sites More sharing options...
LadynRed Posted July 28, 2008 Report Share Posted July 28, 2008 Unless the primary signer defaults, the co-signer isn't even legally liable. If it's truly the co-signer that's filing BK, there should be no impact on the primary. If the BK shows up on the non-filing person's reports, it should be pretty easy to dispute. Link to comment Share on other sites More sharing options...
Denita Posted July 28, 2008 Author Report Share Posted July 28, 2008 I do not know which is considered the primary - the family member that is NOT going BK is the one paying and has possession of the car. The title is in both names. Do you consider the primary the 1st one on the title and payment book? Or doesn't it matter? Just want to make sure the family member is not hurt in any way Link to comment Share on other sites More sharing options...
LadynRed Posted July 29, 2008 Report Share Posted July 29, 2008 The primary, as far as the loan is concerned, is the person listed as primary in the loan papers Link to comment Share on other sites More sharing options...
Methuss Posted July 29, 2008 Report Share Posted July 29, 2008 The primary, as far as the loan is concerned, is the person listed as primary in the loan papersPut simply, this is usually the first name on the loan.Example:Person BPerson AAddressCity, State, Zip"Person B" in this case is the primary. Link to comment Share on other sites More sharing options...
Denita Posted July 29, 2008 Author Report Share Posted July 29, 2008 Ok then, the primary is going to file a BK. The vehicle was purchased about 14 mths ago and the person paying and with possession of the car is the other party, not the primary. It has been that way from day one. The loan is current and payments are made on time each and every mth. If the primary files BK, then does the BK reference attach to the TL so that it shows on the co-signers report? Link to comment Share on other sites More sharing options...
jq26 Posted July 29, 2008 Report Share Posted July 29, 2008 IMO, the co-signer can dispute it off. The co-signer has no liability and did not include it in any bankruptcy of theirs. *But now the filer has to either redeem, reaffirm, surrender, or in some judicial districts ride-through the bankruptcy. It can be a bit more complicated because the BK'er is not the one using the car or in possession of it. So they must disclose this in their schedules. Does the car have equity? Link to comment Share on other sites More sharing options...
Denita Posted July 29, 2008 Author Report Share Posted July 29, 2008 Thank you for the quick response. No. There is no equity in the car. In fact, best case the car loan is $1000 more than value, but more likely the loan is $3000 more than value (depending upon which valuation site you use) Link to comment Share on other sites More sharing options...
Methuss Posted July 31, 2008 Report Share Posted July 31, 2008 It should not affect the co-signer's credit file at all. Since the co-signer did not default and has not filed bankruptcy themselves, their tradeline MUST be updated as if the account is in good standing. Anything less is a false statement in the credit file and a violation of not only the FCRA but the bankruptcy stay and injunction.The bankruptcy stay and injunction order protect not just the person who filed bankruptcy but also the co-signers from retalitory conduct by creditors. Link to comment Share on other sites More sharing options...
Denita Posted July 31, 2008 Author Report Share Posted July 31, 2008 Thank you!! Link to comment Share on other sites More sharing options...
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