Ask The Get Out of Debt Experts Co-Signing Divorce

My Ex-Wife is Claiming Bankruptcy For Some Debt I Am Responsible For. – Steve

“Dear Steve,

My ex-wife is claiming bankruptcy and she has some debt that I am a co-signer on. I do good to get by with the debt that I have myself. I can not afford to take on her debt (about another $200 a month). Should I consider bankruptcy myself? I fear if i do not i will lose my house and my credit will go to crap anyway since i can not afford her debt.


Dear Steve,

Unfortunately since you are the primary person guaranteeing the loan, yes, the creditors will go after you once she claims bankruptcy. Actually they were always going to go after you in case of a payment problem and that’s why they wanted you on the hook as a co-signer.

A co-signer is some that has better credit than the applicant the lender can go after if the applicant defaults. Co-signer’s get all the risk of the loan and none of the benefit. For example, if you co-sign a loan for a car, you don’t have title or access to the car and you won’t own it when it is paid off. But you will be responsible for payments if the applicant defaults or goes bankrupt.

So why should anyone co-sign? Good question. I still don’t know why. Certainly, it is something that I will never do.

If you feel her $200 a month payment is going to push you over the edge financially, you should go and talk to a bankruptcy attorney now and begin to work out a plan on how to proceed when the debt falls in your lap.

Please update me on your progress by posting updates here in the comments section of your question. I’m very interested in how this works out for you.


P.S. Be sure to read ‘The Secret of Surviving Through Difficult Economic Times. What I Learned On My Journey‘.

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Steve Rhode

Steve Rhode is the Get Out of Debt Guy and has been helping good people with bad debt problems since 1994. You can learn more about Steve, here.

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