Cosigning for someone who went bankrupt

September 21st, 2009 by Questions

I cosigned a line of credit for a family member who just declared bankruptcy. Am I able to let the debt go through bankruptcy? Will this put a mark on my credit history and if so for how long?

Posted from: Nova Scotia

Questions

One Response to “Cosigning for someone who went bankrupt”


, Barton Goth - Goth & Company Inc. -Trustee in Bankruptcy said:

What will happen is the bankruptcy will legally remove any responsibility for that family member in connection with this debt. However, when you cosigned the debt you essentially were signing that you would be responsible for this debt regardless of what happens to the other part (i.e. death, bankruptcy etc.). As a result you are now fully responsible for the cosigned debt and if you neglect to make appropriate arrangements for payments then it could damage your credit, but as long as the arrangements are made and upheld then you shouldn’t have any trouble.

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