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  1. #1
    Join Date
    Aug 2008
    Posts
    9

    Exclamation Can I Be Sued by My Cosigner If I File Bankruptcy?

    My question involves bankruptcy in the state of: Michigan

    I was served a summons that I am being sued by the person who cosigned for my home loan.
    Long story short...I lost my job. She wanted us to sell the home as she knew it would be almost impossible for us to make the payments. We agreed...actually we had no choice. We filed bankruptcy. chapter 7. We then worked out payment for the cosigner. She considered the debt between us paid. We moved from our home to another state for work.
    2 years later...now..I am served with papers and I am being sued! All though a lot of our agreement was verbal..there was some paperwork...that I don't have now. We can't find it...I am afraid it was thrown out...it was settled over 2 years ago!
    So..we can't afford to travel to another state to fight it anyways. If your wondering why she would come after us now and for what reason....family..greedy family..she has the beginning stages of alzhiemers..so we know its not her acting alone.

    Since we filed bankruptcy and did not reaffirm the loan on the home...can she still sue us for the difference? Or is that debt considered part of our bankruptcy....since it is for the loan we included in it?
    We do not have the money to fight it.....so if she will get the judgment if she is able to still sue us.

    If that happens..how easy will it be for her to get an order to garnish my husbands wages?
    I know most cosigners get screwed...but we honestly paid it with my retirement. So we are the ones getting ......
    Any help would be appreciated.

  2. #2
    Join Date
    Sep 2005
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    Default Re: Can I Be Sued by My Cosigner If I File Bankruptcy?

    Did you include your cosigner in your bankruptcy?

    Was yours a zero assets Chapter 7 bankruptcy?

  3. #3
    Join Date
    Aug 2008
    Posts
    9

    Question Re: Can I Be Sued by My Cosigner If I File Bankruptcy?

    Yes it was A zero asset bankruptcy.

    The co-signer was not included. Person was however notified. I have had the chance to speak with an Attorney. He stated that the person can not sue us because the debt was discharged and we did not reaffirm the loan. Stated that this person is no different than a creditor. That debt was discharged and no one can collect on it.

    I still can't help but worry. I hope he is right. It seems like I have seen people get sued from the co-signer.
    We originally did not even include the loan so as to protect the co-signer. The person wanted us to as they did not want a negative impact on their credit. So we added it on and the the debt was resolved between us. Family has now stepped in and decided they want more.

    So....what is your opinion. Will they still be able to sue us?

    We don't have any assets. We are just getting our credit back....the only remedy would be to garnish wages. If they did that...we would not be able to make it.
    We just can't afford for my husband to take off and fight it. trust me I know it is usually the cosigner that gets taken. But that is not the case here.

    Any help would be appreciated......
    Thank you for your time.

  4. #4
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    Sep 2005
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    Default Re: Can I Be Sued by My Cosigner If I File Bankruptcy?

    I agree with your lawyer that your obligations would have been discharged through the final order of a zero assets Chapter 7 bankruptcy, whether or not the claim was formally included in your bankruptcy. The person could conceivably file a lawsuit - but you would then raise the bankruptcy as a defense.

    Sometimes to make stuff like this go away you can go back to the bankruptcy court and seek an amended order discharging the implicitly included obligation, but that shouldn't be necessary.

  5. #5
    Join Date
    Aug 2008
    Posts
    9

    Post Re: Can I Be Sued by My Cosigner If I File Bankruptcy?

    Thank you for your response. I will let you know how it turns out. I just mailed the summons that states I am being sued to the attorney. He will then get a letter off to the attorney who filed it for the other party.
    He said if he is smart he will back off then. But if he does not drop it, he will be sending me papers to be mailed off to the state bankruptcy court for a hearing. He stated the bankruptcy court frowns on people coming back once a debt is discharged.
    My concern is still that she was not listed. It is my understanding that as long as she was aware and did not take action at the time...2 years later is to late.
    I am not sure how it works. It was my understanding that you can only add on something to your bankruptcy within 30 days.
    I do appreciate your time. I think you are probably correct. The court will add it on as it is a part of the original debt discharged. I hope.


    Thank you,

  6. #6
    Join Date
    Apr 2007
    Location
    Il.(near StL,Mo.)
    Posts
    5,252

    Default Re: Can I Be Sued by My Cosigner If I File Bankruptcy?

    You should be ok - let your lawyer handle it/follow your lawyer's advice. (Anyone can sue anyone else for anything but that doesn't mean they will win & they may end up not suing in this case.)

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