If a co-signer files bankruptcy is the signer responsible for the debt?

Answer by  John (9008)

Although the loan can specify differently, the signer is generally responsible if the co-signer cannot pay. The signer is actually the person primarily responsible for the debt no matter what.

Answer by  hctafoya (15)

Yes the signer becomes solely responsible for the debt remaining because in a cosigning case, the lienholder utilized a credit report for BOTH parties and most likely disclosure documentation was signed at the time the loan was completed to notify both parties of the responsibility.

Answer by  tamarawilhite (17883)

Yes. If one signer does not pay or is unable to pay the debt, the debt holder can legally go after the other signer. A co-signer / signer is also obligated if the other signer dies. The only exception is if the debt is forgiven or reduced to the amount paid.

Answer by  maber (1427)

It will depend on the type of contract and what is being considered, however in most cases the main signer will still be responsible for the debt if the cosigner declares bankruptcy.