QUESTION
My parents paid a loan a family member filed bankruocty on. How can I find out what recourse my father has?
Asked on Jun 07th, 2011 on Bankruptcy - Virginia
More details to this question:
My parents cosigned on a loan YEARS ago for my aunt and uncle. They filed bankruptcy & my parents had to pay their debt. My mother has recently passed away, and my uncle is in the process of securing a loan to purchase a house. As my father doesn't remember the details of the loan, how can I go about finding how much they paid to cover this defaulted debt so that I can get the money that they paid, back. My mother was beginning to look into it when she passed away.
1 ANSWER
William/J Joanis
Your father paid a debt (to a bank or whatever) that he and your mother had guaranteed. The primary obligors (aunt and uncle) received discharges in bankruptcy. The record of that loan is available in the bankruptcy record of the primary obligors (aunt and uncle). But since they (aunt and uncle) were discharged from the obligation to pay the debt to the creditor (bank or whatever), they were also discharged from the debt to the guarantor (your father). The effect of the discharge (Section 524 of the bankruptcy code) bars the co-debtor from seeking contribution for the amount paid.
Answered on Sep 17th, 2011 at 6:12 PM