Conditions For The Co-Signer Protection In Columbus GA

The credit counseling services check out whether debtors can pay at least 60% or more of their debts so that they don’t have to file bankruptcy. Moreover, those opting for bankruptcy will have to go through a Means Test which can determine the type of bankruptcy that he should file. When you qualify through the Means Test, the court appoints a bankruptcy trustee to supervise the payment of your debts. Usually payments towards secured debts like mortgages are given priority over unsecured debts during a bankruptcy case. Otherwise the lender may take away the property acting as collateral for the secured debt. If the debtor discharges his debt through bankruptcy, the creditor has the legal right to demand that your co-signers pay the bill. But there are some variations. If, for example, you file Chapter 7 bankruptcy, the creditor can proceed against your co-signers, according to the terms of the debt agreement. However, if you file a Chapter 13 debt adjustment, a co-signer is protected if the following conditions are met:

• The debt must be a consumer debt
• also, the debt may not be incurred in the ordinary course of business,
• and the co-signer cannot benefit from the proceeds of the debt
• as long as the debtor is making the required payments under the Chapter 13 plan, the creditor cannot act to collect from the co-signer. The
purpose of this provision of Chapter 13 is to allow a debtor to repay the debt without the creditor approaching the co-signer for repayment.

Our bankruptcy attorneys are based in Columbus, GA (Georgia). If you are located in Columbus, GA (Georgia), Fort Benning GA (Georgia), Chattahoochee County, Harris County, Marion County, Muscogee County, Lagrange, Atlanta, Albany, Newnan, Peachtree City, Carrollton, Muscogee County, Troup County, Phoenix City AL or Opelika AL, contact us. We can help you file for bankruptcy.

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