It’s important for Tennessee residents to establish a credit history. Without a credit history, it’s difficult to buy a car or house or take out a loan. That is why young adults may turn to their parents to co-sign loans so they gain experience making payments. This can be a good solution if the person has a steady job and can afford to make regular payments. However, life does not always go as expected. A person can suddenly face unemployment, divorce or any other type of emergency financial situation, causing him or her to fall behind on payments. This will then affect the co-signers, who will be harassed by creditors. How can you remedy this situation?
When co-signed debts don’t go as expected, you need to take swift action. If you don’t, the debt will continue to pile up and you will end up financially burdening your loved ones. Ideally, you don’t want your parents to face that situation. They believed in you and trusted you to make timely payments on the loan, and now you let them down.
Bankruptcy is a complicated topic with many nuances. If you are struggling with debt, you shouldn’t go it alone. With help from a bankruptcy lawyer, you’ll find a solution that fits your needs. Chapter 13 bankruptcy is the preferred option, since it protects co-signers as well. However, Chapter 7 may be a viable option as well.
It is possible to protect your loved ones when overwhelming debt leads to bankruptcy. Contact a bankruptcy lawyer to learn more about the available options that can benefit everyone involved.