crfix Posted March 22, 2011 Report Share Posted March 22, 2011 NOTE: I'm in the middle of purchasing home. (appraisal done!)Background info: About 3 years ago, my dad helped me finance my car (his credit was better than mine). I have always paid on time.Over the last year, I started to seriously work on my credit. I went from 616 to 740 in just 6 months and have remained there for the last 6 months. So... I decided to make the leap and buy a house! I'm in the middle of the process - have been pre-approved, found the house, and we just got the appraisal done. Funding the loan isn't too far off. So while I'm doing good credit-wise, my parents aren't and decided to file bankruptcy. My dad said he told his lawyer NOT to include my car loan in the bankruptcy and specifically told him that I am in the midst of buying a home and asked if it would affect me. The lawyer said NO because the loan is not being included and has been paid on time since day 1.This was Wednesday last week. Today, Monday, I tried to log onto my car loan's website (to check the status as I randomly do just to keep up with everything) and I got an error message: "You are not authorized. Please call us at..." WTF? So I called the number and since it's late, it's just a recording. It says that one of the parties on the loan has filed for bankruptcy and so access to the account online has been disabled. Statements will no longer be sent (online or via mail) but voluntary payments can be continued to be made via my own bank's bill pay or I can mail the payments if I have the address and the account number. It says any questions should be directed at the bankruptcy lawyer.So, I called my dad (crying!) asking him what's going on. He says it must be a mix-up and will get on the phone first thing in the morning with the lawyer, with the lender and anyone else he needs to to fix this and to make sure it doesn't affect me. But I'm afraid it may be too late!He filed chapter 7. Says the car was coded "R" (retained?) so that it would not be included in the bankruptcy. Will the lender (toyota) report this as derogatory to both of our (MY!) credit reports even if it wasn't included??I'm afraid to go to funding and find that I no longer qualify because of this! btw- I am currently subscribed to MyFico.com and I have not had any change in my score/report yet but this only covers Equifax. And then again, it's still early if they just filed so again, who knows...Please, any insight you can provide will be greatly appreciated! Link to comment Share on other sites More sharing options...
Denita Posted March 22, 2011 Report Share Posted March 22, 2011 When your Dad filed BK, he had to list the car payment as he is on the car loan as your co-signer. This will relieve him from any responsibility of repayment of the loan at any time. It is a moot point for you because you are the one that has possession of the vehicle and you are the one making payments. You might want to put together proof that the payments come from you and not from him in case the BK Trustee requests it. Other than that your car is safe as long as you keep the payments on time.As to the lender marking the tradeline as IIB, they can not do that on your credit report. You did not file BK, so you are safe there. If they do mark the tradeline on your report, you can have it removed immediately. As to the payments being made: you need to contact the BK department of the lender. Since you are on the loan and you did not file BK, they are allowed to continue to send you monthly statements and keep your online access to make payments available. However they are not allowed to send statements to the co-borrower that filed BK. It sounds like they just put it in the BK department automatically in order to avoid sending out a statement to the wrong party (even if he never got any statements before!).Call the BK department of the lender right away to straighten out the billing situation. You might have to make a few payments directly to the lender thru the BK department over the phone or through your banks bill pay feature as normal customer service won't touch a payment. Do this immediately so you won't be late with your car payment and your house loan won't be affected. DO NOT WAIT to make a payment, the late pays will show on your credit report if you do wait. You may have to insist with the CSR's to get through to the BK department, but you will eventually be able to speak to someone that knows what they are doing and will help you work out this snafu. Good luck! Link to comment Share on other sites More sharing options...
Denita Posted March 22, 2011 Report Share Posted March 22, 2011 One last quick point: if for some reason the TL shows as iib on your cr report prior to your closing, you can get a copy of your Dad's BK filing from PACER and a copy of the car loan to show to the underwriter of your house loan. It should satisfy the underwriter that your Dad is the one that filed and the TL was erroneously marked.I really think that it is unlikely that you will have to go through that at all. The only way your house loan could be affected by your Dad's filing is if you don't make the vehicle payment on time - and that will hurt your house loan. BTW, congrats on the new house! Link to comment Share on other sites More sharing options...
Methuss Posted March 29, 2011 Report Share Posted March 29, 2011 (edited) This happened to me with my prior BK filing. My wife and I were co-borrowers. I filed, she didn't. Mitsubishi basically stopped sending all statements and refused to start again until my wife threatened to sue them under unfair and deceptive trade practices and for violations of the Fair Credit Billing Act, the Truth in Lending Act. That got their attention. Edited March 29, 2011 by Methuss Link to comment Share on other sites More sharing options...
nadiyab1 Posted November 9, 2011 Report Share Posted November 9, 2011 my grandfather co-signed for a truck for me but on the contract from the dealer we are co-borrowers the credit union has now told me they can not speak to me because of the chapter 7 filing with the primary on the account i have been fighting for months because i continue to make voluntary payments and no one can tell me if and when i pay the vehicle off if i will be able to receive the title and own my truck. my truck was supposed to be left out of the bankrupts as well but i guess did not my grandfather also has a second mortgage through them and i am afraid once the truck is payed they will take it for the debt owed on the second mortgage i do not know my rights or what i can do. and I'm supposed to have a fix interest rate but every month it is a different amount that goes toward interest even if the same amount of days between each of the payments are the same. i have no idea how to get any information on my vehicle or know what will happen to it Link to comment Share on other sites More sharing options...
2ndTimeAround Posted November 9, 2011 Report Share Posted November 9, 2011 One last quick point: if for some reason the TL shows as iib on your cr report prior to your closing, you can get a copy of your Dad's BK filing from PACER and a copy of the car loan to show to the underwriter of your house loan. It should satisfy the underwriter that your Dad is the one that filed and the TL was erroneously marked.I really think that it is unlikely that you will have to go through that at all. The only way your house loan could be affected by your Dad's filing is if you don't make the vehicle payment on time - and that will hurt your house loan. BTW, congrats on the new house!Good Advise Denita....Years ago as a loan officer had the same thing happen. What you need to do is write a letter explaining the situation. Then include 12 months of bank statements showing you made your car payments on time. It shouldn't be an issue....Dito - congrats on the new house..... Link to comment Share on other sites More sharing options...
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