Legal Question in Bankruptcy in North Carolina

As you know, there is a problem with co-signing for someone because generally, you remain liable for the full amount. There may be relief against collection efforts by the various lenders. These include: 1. Breach of the Contract in delivery of the goods, or breach of the contract in collection efforts or abuse of consumer credit laws in collecting. 2. Failure to exhaust remedies, such as failure to pursue the primary debtor or collateral. You always have the right to recover against the primary debtor. I assume that the primary debtor of the cosigned debts is in prison, which means your remedy is to take the judgment and find assets to sell or wait until released and attach wages. Not often is there assets or successful recovery from a felon. If a charge is not authorized, you are not liable. Of course, if the application for the card has both names, then both are liable for all the charges. Credit cards and collection companies are hard to convince that a family member was not authorized, however, the type and location of the charges and the conviction, may be sufficient. The defense is more easily presented as a formal defense in trial of a collection action because the trier of fact is a neutral party. Not often does a credit card company actually bring suit. The company and its assignees, or a collection company will just harass hoping to collect. The best remedy is to communicate in writing and explain what charges were not yours and why. You should create accountability by recording with whom and when you communicated. Keep it in writing where possible. Once you inform the collector of the facts which exonerate you, then tell them the same and tell them also that if they call again or bring the suit, you will bring a counterclaim. As for the charges that are legitimate, you should review your whole situation to determine if bankruptcy is useful for you. Bankruptcy will eliminate even the questionable charges. Otherwise the plan could be: 1. Just ignore and go on. In time they will stop calling. If there are no real assets to take, they will not sue. This does not cure the bad credit reporting. Because of the wage attachment possibilities you should try to settle a debt upon which suit is brought or be prepared to file a bankruptcy which stops all suits and garnishments. This strategy delays filing with the anticipation that it may not be required. 2. Go to a Consumer Credit Agency. They will evaluate and perhaps set up a plan of repayment. They might get a reduction in debt and would likely get a reduction or hold on interest and penalties. 3. Negotiate settlement yourself. This is best done through a lawyer, but can be done yourself. 4. Send out "take it or leave it" checks with a offer and demand that the check be returned unless accepted as payment in full.

As a bankruptcy, you qualify for Chapter 7 unless your income is very high. You can file bankruptcy yourself, but is difficult and would take a lot of reading. There is a waiver provision for the filing fee if you cannot afford the $299.00. The key points are: 1. Full disclosure, You must take consumer credit counseling prior to filing. You must file and provide tax returns, and pay stubs. Many lawyers will file for a needy client at a reduced fee.