Legal Question in Bankruptcy in California

I want to file a no assets bankruptcy within the next 30-60 days. I will be filing in California and since I have no assets and no income to speak of for the past 18 months it should be relatively straight forward. There is one thing, I co-signed for my brother when he purchased his truck about four years ago. He has made all the payments and he only has seven payments left. My questions are should I get off the loan before I claim bankruptcy? Will it appear fraudulent if I do? If I don�t will the truck be considered an asset of mine that the court might take from my brother? I have a car of my own. Also, can I just not list the loan on my schedule and he will continue paying till it�s paid off? Or will this appear fraud-like to the court?


Asked on 12/21/10, 1:14 pm

1 Answer from Attorneys
Brian Whitaker Lifeline Legal, LLP

If you co-signed for him, then your name is likely on the registration as well as the loan. None of this is a problem in your Chapter 7 (unless the vehicle is worth more than $25,000 more than what is owed). You will be discharged of any liability you have on the loan but your brother will not. As long as he keeps up the payments, he can keep the truck. You would list both the loan and your 50% interest in the vehicle (zero if there is no equity).

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Answered on 12/26/10, 9:19 pm


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