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If you do not have a good credit score, getting mortgage or automobile loan might be difficult unless you have a co-signer for your loan who has a good credit score. However, a co-signer is equally liable for the debt as is the primary debtor, say lawyers of Los Angeles based bankruptcy law firm Recovery Law Group. This can be detrimental for the co-signer, especially if the debtor ends up filing for bankruptcy. This occurs in case of job loss or divorce. In case, the co-signer is the spouse, they will be required to pay for the debt. This might result in both going underwater which results in bankruptcy filing for them. Hence, in case of debtor’s bankruptcy filing, the co-signers are sent a special notice to inform them.
When a debtor files for bankruptcy, the co-signer can continue making payments on the loan. This would be essential to maintain their own credit report. This is often seen in case of student loan, where the loan is co-signed by parents. If the student fails to secure employment, the parents will be held responsible for the same and would need to clear the debt. In case you have co-signed a loan or are a co-debtor for one and bankruptcy is on the cards for either you or the other debtor, it is important that you consult with bankruptcy attorneys at 888-297-6023 to know your options.