Auto Loans After Chapter 7 Bankruptcy

auto loans after chapter 7 bankruptcy

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What happens when a co-signer files bankruptcy?

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We are the co-signer on an auto loan for a relative. We are having to file a Chapter 7 bankruptcy. I need to know how exactly that will affect the main borrower. We are planning on “reaffirming” the loan, so that the person will not lose the car.

Will this mean that we will be removed from the loan and the main borrower will be responsible for all payments and keep the vehicle? Or will it mean that we will still be on the loan after the bankruptcy? Or what are the other possibilities?

Bankruptcy questions are best directed toward your licensed, experienced bankruptcy attorney rather than on a worldwide public internet forum.

That being said, reaffirming the debt means you will still be on the loan, and on the hook if the main borrower defaults.

By the way, it is NEVER NEVER NEVER a good idea to co-sign for anyone on any kind of loan, so please think twice before reaffirming.

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