Bankruptcy / Co signer on a loan quesiton
 

Alright my girlfriends step dad co signed a loan for her to get a car about a year ago ... she has like 5 g's of it paid off ... she hasa bout 8.5k left to pay on it
but her step dad is wanting to file bankruptcy like a jackass and he is saying all this shit about how when he does they are gonna take her car and all this shit

anyone know anything about this?

he co signed and put his travel trailor and one of there vechiles as colitoral ... we have almost enough paid off to get the title back on one of there vechile's


so my quesiton is - when they file bankruptcy what will happen to the loan he co signed on ???

No payments have ever been missed or been a day late

uhh ..
Im not sure about cars ,
but when I was younger my dad cosigned on an apartment , and he was only liable for 1 year

when you file for bankruptcy you have to make a detail record of all YOUR assets, and all of YOUR liability.

As long as asset is not in his name they couldn't take it unless they could prove that he was funnelling the asset away from legitimate creditors (fraud)

However his credit is crap for the co-signing so the bank is perfectly within it right to call the loan immediately.

Review your documentation, confirm that he hasn't secured the asset for other loans (your screwed) and consult a good lawyer

hmm - i need to see i can fin dthere contract

hmm he wasnt there when she bought the car - what she did was got a loan from the bank and took the money fromt he bank and bought the car striaght off a lot ......

so are you saying if he isnt on the car at all we should be fine ?

also i dont understand what you mean by
"However his credit is crap for the co-signing so the bank is perfectly within it right to call the loan immediately."

When you get a loan with a co-signer the loan is actually the co-signer's. You make the payments but if you default etc, it is the co-signer who is affected more htan you. If he does there is a good chance that you will loose the car as the loan will be recalled and the car resold to reclaim repay the debt. Your best bet is to try to get his name off it NOW. Perhaps the bank will be nice since you have been making payments.

Ask a lawyer, Don't take any chances.

argg why did you have to post that :(

god i cant belive her step dad is being such a dick

I might be reading this wrong, but if he cosigned a loan for her

and the loan is in her name

and he just co-signed

and she is making the payments

then whatever her dad does is irrelevant.

they will come to him if she does not make her payments

he's guaranteeing that the note will be paid = cosign

thats what we are hoping will happen

we are not worried about paying the loan every month as it is only 250$ a month and we could even pay more if it came down to it

the thing is though - the colitoral that was put up was HIS

i dunno - this is just an extra stress as it is our only vechicle and my girl is 39 weeks pregant due any day now and she is worried we are gonna lose our car and all this crap :(

the thing is we are not going default - he is. he is going bankrupt. we have no problem making the payments at all we just didnt have the colitoral to put down

you are worrying way too much....

lol wish i could be as calm as the shemp! :glugglug

I don't think you have anything to worry about

the bank wants their money and interest and you're giving it to them, end of discussion..


hypothetically speaking, what if he was to die, do you think every person that dies they go find all the loans they cosigned on and take the shit back?


i could be wrong but i doubt it

The only thing you have to worry about is if she quits paying and they go back to him and he is bankrupt and doesent pay, they are just fucked, that's a risk they took in doing business, then they will repo the car.

Good point - we are going to the bank tommrow - we just found this out toinght

we have paid off all intrest already and now we are paying off the princeapal ... plus its a small town .. small bank ... i went to school with the girl who gave the loan

that type of town lol

refiance the loan, plain and simple

car loans are demand loans (at least in ontario at the big 5 banks), if credit conditions change (like the guarrentor declaring bankruptcy) the bank has the right to demand payment in full right now.

you don't have the money your screwed.

If you've been making all your payments on time, you should renegotiate the loan and take him off of it. Assuming your credit and your girlfriends credit isnt shot to shit, you should be able to negotiate fair terms. Just take a slightly higher interest rate.

The problem is, if they find out he went bankrupt, and you didnt tell them, they'll definitely pull the loan. BUT, you can play the chance that the information will never come around to them and you can continue making your payments happily. Just never be late. :winkwink:

Bottom line is this: They gave her the loan only because he was able to repay them if there was a problem. If he can no longer protect the bank if she screws up, why would the bank risk it's money?

Get his name off the laon ASAP. Also keep in mind that the payments will be more as the loan was based partially on his good credit score. Sorry about your luck.

The bank already risked it's money.

is that english?

Bingo! At least unless the note says something different. Just read the note.

Someone already suggested this, but refi the loan. You've got enough collateral built up in the value of the car that you should easily be able to get his name off the loan and solely in her name.

Ya! they get fucked too!

Ditto the refinancing the loan suggestions. The bank doesn't want the car, they want someone who will make the payment on it every month. If they know he's getting ready to file BR against it and she has a good history of making the payments (take canceled checks in to show she was making them) it should be relatively easy to get his name off the loan and get her a new one.

how can the father file on the car? He is just a cosigner

he's only guaranteeing that she will make the payments.

even if she filed but still made her car payments it is doubtfull they will repo it because she did not default their terms, she is still paying.

The car is collateral for the loan. If he defaults on the loan, they have every right to get their collateral.

It doesn't matter if she's current on the statements. He is filing bankruptcy and per BR law, he has to include all his debts - which now include the car.

No, he's not guaranteeing she will make the payments. SHE is guaranteeing she will make the payments and by being a co-signer, they are both equally liable for the payments of the car. That's why it's called a co-signer. :thumbsup

Her loan contract probably outlines all this, BTW.

How can he default on the loan unless she defaults first?

A cosigner is a person who signs his or her name to someone else's loan agreement or credit app and agrees to pay the debt in full if the primary signer defaults on the loan.

I agree with you.