Cosigner Question on Bankruptcy Filing

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  #1  
Old 11-04-10, 10:19 AM
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Cosigner Question on Bankruptcy Filing

I cosigned on a Computer Student Loan fron Wel;ls fargo in 2000.
He has since successfully filed for bankruptcy in 2008.
When he filed I asked him howI would be protected and he said there was a protection provision where he asked I be protected from this cosiner resposibility as partof his bankruptcy filing.
He said Wells Fargo was notified and they did not show up in court to dispute his filing.
I recently got served to come to court and pay this outstanding balance on my friends loan which ia 15,000.
He paid into the loan up to 2008.
My friend told me he believed he signed the original bankruptcy paperwork including me as being protected from responsibility of this loan.
Is that simply a lie or is there any kind of protection provision?
My next question is what recourse do I have if my friend did lie?
Or if his lawyer really did neglect to include me in the protected list for debts incurred?
Doi have any options to pursue in court?

Thanks
R taylor
 
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  #2  
Old 11-04-10, 01:45 PM
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I've never heard of anything like that [not that I would know] I'd contact your friend and see what his paperwork says, then I'd consult a lawyer and see where you stand. I wish you luck, I suspect you'll need it.
 
  #3  
Old 11-04-10, 01:56 PM
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Iím not a lawyer, and only looking at this from a common sense perspective. It just doesnít pass the smell test . . . if co-signors could relieve their financial obligations by having the primary borrower file bankruptcy, and the co-signor not required to provide any supporting evidence to a court concerning their financial condition, loans scams would skyrocket.

Donít rely upon verbal statements made by your supposed friend. He should have provided (or you should have demanded) a copy of his filing and the final order of the court so that youíre not dependent on what he tells you. Trust but verify. My gut says your friend is feeding you bs as it doesnít add up based on the way the situation is being described. I find it strange that when your friend tells you in 2008 that this is going down you seemingly take no action to speak w/ his lawyer or ask to read a draft of the filing to get comfortable with what your friend was telling you . . . what were you thinking?

This link may be helpful What Happens to a Cosigned Loan in a Bankruptcy? | eHow.com. It sure doesnít seem like your friend Ďreaffirmedí his commitment to your co-signed loan.

I donít think you have any recourse against his lawyer, and I suspect his lawyer would tell you he never told your friend what he is telling you. I would believe the lawyer. You may have been snookered as your friend may not have wanted you or your attorney showing up in court to contest the bankruptcy filing if you knew you were going to get stuck paying off his loan, and especially if you had knowledge of his assets if not fully disclosed to the court. If your friend lied to you, then there is no telling where the lies begin or end. If he wonít provide you a copy of the bankruptcy filing and court order, go to the courthouse to obtain the records about this case. Who knows, perhaps there was no bankruptcy filing and he simply stopped making payments assuming Wells Fargo will hound you for payment instead of going after him. It also seems strange to me that Wells Fargo seemingly made no attempt to communicate with you, or maybe you were dodging them, as an alternative to taking you to court. Also look for any notice as I would think there are federal requirements to notify creditors and co-signors of such filing in order for them to introduce evidence to counter his claims. If there is a notice requirement and you were not properly noticed, then that may give you an opening to pursue. Look at his stated assets in the filing if you know this person well as that might be angle to pursue if you were able to present evidence showing that his assets were misrepresented in his filing. You can hire a lawyer to do all of the leg work or do some of this yourself before going to an attorney to get advice. You might get a free hour of attorney time that would help shape the work you might be able to do based on direction of that attorney if you're short on money.
 
  #4  
Old 11-04-10, 07:29 PM
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Not a lawyer here, either, but I think Rob pretty much covered it. I suspect the bottom line will end up being that you are on the hook for the outstanding balance; that's why lenders take on a co-signer - gives them another shot at getting their money back in the event the primary borrower defaults.
 
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