co signer and bankruptcy

April 5th, 2010 by Questions

I co signed for a student line of credit for a person a few years ago, now this person has gone into personal bankruptcy with a Licensed Insolvency Trustee.My question is after this person is finished with bankruptcy is there any leagal avenue I can persue to recover my money

Posted from: Newfoundland and Labrador

Questions

One Response to “co signer and bankruptcy”


April 06, 2010 at 9:00 am, Barton Goth - Goth & Company Inc. -Trustee in Bankruptcy said:

No, there are no legal avenues that you can pursue. Ultimately you signed on the debt, and when you did so you essentially verified that whatever happens to the other part (i.e. death, disappearance, bankruptcy, etc.) that the debt would be paid in full. You didn’t have a formal loan agreement with the person you cosigned with so they have no obligation to you (although, if there was a contract or agreement signed the debt would have been cleared by the filing of the bankruptcy). So at this point you are solely responsible for the debt in question and there really is no recourse available to you.

It is precisely for this reason that I strongly recommend people not acting as a cosigner.

Please post a follow up comment below:

(Note: comments are reviewed by moderators and then posted after approval. In addition, due to high volume some of the comments might not be posted.)