If my adult child files bankruptcy

[JDS1946]

What is the name of your state?What is the name of your state? Texas.

I have and adult child who has allowed himself to get into financial difficulty over the past several years. He was living with his mother until about 2 years ago. When he moved into his first apartment, he needed me to co-sign on the lease because he had no credit history. His mother could not sign because she has a history of credit problems (a whole different issue, and yes, I have been divorced from his mother for almost 20 years).

While he was living in the apartment, the hose on the washing machine jumped out of the drain pipe and caused water damage to the apartment. After reviewing the lease agreement, I personally believe that my son was/is responsible for the damages claimed by management.

Now more about my question. This son is about to file for bankruptcy because he feels he can never get caught up on the amount he owes on credit cards, student loan, and this apartment mess. They tell him that he owes over $4,000. I have noticed that this now appears on my credit report, even though I have never been notified of anything due. When my son's lease expired, he processed out of the apartment and no notification was given that he owed this amount.

The question is, assuming that he is liable for the damages, and he does file for bankruptcy, am I (as a co=signer) still responsible for the full amount of the damages? I have had a near perfect credit report for almost 20 years. I have co-signed for some of my other children too, and just need to know what happens to my credit if they declare bankruptcy.

 

[AttorneyOney]

A bankruptcy discharge does not discharge the obligation of a co-signer. If someone files under chapter 13 and files a 100% plan, something called the "co-debtor stay" prevents a creditor from going after a co-signer. There is no similar thing in chapter 7.

 

[Ladynred]

Nothing should happen to YOUR credit if your SON files for bankruptcy. IF anything shows up saying the account was included in bankruptcy, you must dispute it with the credit bureaus and it should come right off. YOU did not file for BK.

You co-signed on his lease. Typically that means they come after you for unpaid rent. Does his lease say anyting about the co-signer being responsible for damages too ?? You should also check out your state's Landlord-Tenant laws, your son should have been notified of damages owing after he moved out.

 

[Who's Liable?]

Also, his student loans are NOT dischargeable...

 

[anabanana]

Just drawing a couple conclusions from the info provided ... he got himself into all this mess and debt over just two years? He had no credit history up to two years ago, and since then he's accrued enough debt and liability that he thinks bankruptcy is a good option? How freakin' bad could it be??

You seem like a decent sort of dad. Tell your boy to be a man and get a second job and pay down his debt like a responsible person. Tell him he is too young to destroy his credit like that. Please tell him that the bankruptcy system is not a free escape route for those who "just don't wanna" pay their bills. A broken washer hose is not a life-altering calamity. It's not a medical crisis or a natural disaster or any other such thing. If he thinks it's too much, he could very likely negotiate a reduced amount and they'd probably be happy to accept it, certainly over being stiffed altogether. Dad, give your boy a talking to and tell him that if he buckles down and matures a little and takes responsibility for his obligations, he could be free of them way sooner than he'll have a BK off his credit, and as a bonus, he'll still have some dignity, and his father will be proud of him for doing the right thing instead of taking the easy way out by screwing someone else.

And if he still thinks he's entitled to file bankruptcy, send his heinie on over here to Florida and let him take a look at some of the folks in the bankruptcy court who don't have a pot to piss in because everything they owned got blown down the street and their FEMA trailer got dezoned right before Christmas, and their employer closed up shot and their spouse is disabled from storm injuries. THAT's someone who needs bankruptcy protection. Not some youngster who wants to play on someone else's nickel. Sheesh.

Good luck, Dad.

 

[GaAtty]

GaAtty

As an attorney who practices bankruptcy, landlord/tenant law, and other civil litigation in Geogia, I will say that your case seems to be a combination of all of these areas.. ..First, $4000 is a very small amount to bankrupt for. Second, his bankruptcy should not go on your credit. Third, the student loans can be put in forbearance (which is easier to get than a deferment) Fourth, in this state, and probably in your state, the landlord's claim may be able to be successfully fended off. How? (Again, Ga. law) If the landlord does not return his deposit OR give a written notification within the required time of his vacating the apartment of the damage AND present him with itemized costs of the damage in writing AND do an inspection within a certain number of days after he vacates, AND give him a copy AND they must have done a written pre-inspection (before moving in) AND given him a copy, the landlord cannot keep the deposit. There is a penalty to the landlord of 3 times the deposit (goes to the tenant) and the tenant's attorney's fees. They also must keep the deposits in a particular escrow account. If you have such laws in Texas, and the apartment did not follow their procedure, then maybe they owe your son money instead of the other way around. As you can see, there are a number of requirements, and most landlords mess up somewhere along the way, and usually a tenant with an attorney can find one of their errors. Second, you may want to either negotiate with the apartment on a reasonable cost of repair, or wait until they sue you or your son or both. They may not bother to sue. The advantage to negotiating now (other than a quick resolution) is that they may let you look at the apartment damage and get repair estimates, which may be hard to get later when someone else has moved in and the apartment has already repaired the damage. Maybe they will let you pay the repair people directly. If they won't go this route, or you don't want to, wait and see if they sue either of you. Remember that in order for the cost of repair to go on your credit, they must sue you in court and lose. That is expensive and time-consuming for them. they may not pursue it. Even if they sue your son and not you, you could ask an attorney to see about getting you in the case (it's complicated). One of the defenses that you and your son would raise is, of course, whether their cost of repair was reasonable. Padded bills always happen. Another defense may be based on the question of whether he was negligent, and I don't know enough about washer hoses to know that. After some point their own insurance should kick in. You son's liability may be also be limited by his lease or by some state law. If you get a good attorney who does landlord/tenant or civil litigation or torts litigation, there are probably other defenses you have. If you do get such an attorney, they could tell you if they think it is worthwhile to try to negotiate or whether you are better off just to wait and see. Another reason to wait until they sue you is that lawsuits take time, such a case here would take 6-12 months to get to jury trial. In that time, your son may get some things taken care of and be in better shape financially and can make them an offer before trial, if he wants. (A good way to find landlord/tenant attorneys who have experience in the tenant side is to ask your local legal aid office for some names. Legal aid attorneys get lots of experience in landlord/tenant, and often go out into private practice after working in legal aid for a while.)

 

[GaAtty]

GaAtty

Correction to my previous post, I did not mean to say "Remember that for the cost of repair to go on your credit, they must sue you in court and LOSE." I mean to say "sue you in court and WIN".