Houston, TX asked in Bankruptcy for Texas

Q: I cosigned on my moms car and she filed bankruptcy. What does that mean for the car

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1 Lawyer Answer
Mr. J. Thomas Black
Mr. J. Thomas Black
  • Bankruptcy Lawyer
  • Houston, TX
  • Licensed in Texas

A: Without more information it is difficult to say. Is she going to keep the car, pay for it and reaffirm the debt? If so you will be "off the hook" so to speak. But if she is going to surrender the car and discharge the debt, you will still be liable for any "deficiency" or balance due after the car is repossessed and sold. The creditor could ruin your credit and even file a lawsuit against you to recover the deficiency.

That's a very good reason to never cosign someone else's debt. There is a reason that they need a cosigner; their record of paying back their obligations in a timely manner, i.e. their credit history, is not good.

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