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Treatment of divorcing co-signers of huge student loans not yet in default but soon

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    Treatment of divorcing co-signers of huge student loans not yet in default but soon

    CT parents divorcing where one or both parents co-signors on three large student loans totaling about $150K (probably higher with interest accrued over late payments, etc) for a 25 y/o resident of MA now unable and unlikely to find meaningful work. Child wants to pay debt but will never be able to. Bankruptcy is likely but after divorce is final.

    1) Mother co-signed online in husband's name with his permission, which he now denies, but history shows that this was the customary way the parents treated the process of co-signing loans. She did the leg work on finding the loans and b/c he has higher income, his name was used to co-sign. Now he wants to make an issue of her "fraudulently" co-signing his name online. On the other hand he is in communications with the banks as the co-signer. Can he make his wife signing his name an issue in the divorce?

    2) Do the parents each have to list themselves as co-signers of loans for purposes of the divorce when the loans are not yet in default? Only the ones where one's name is actually on the loan, or on any where both parents feel they are responsible for half the debt?

    3) The mother is not trying to get out of her half of the responsibility for the debt. How does she take responsibility for her part of the debt before, during and after the divorce?

    4) Mother will not be able to pay her half of the daughter's debt after the divorce? Can she do anything pro-actively to avoid having to declare bankruptcy herself?

    5) Daughter has forebearance on two loans and is paying one now, but it is clear that she will never be able to pay three when due. What happens if she cannot get the creditors (banks, not gov'ts or schools) to lower her payments to what she can afford and she defaults, but this happens one to two years after the divorce is settled?

    6) Not sure how to consult with attys - first a bankruptcy atty or first a divorce atty??? Does one know answers to these questions better than another?

    Thanks and sorry if this is too complex for this forum? I've never used a forum before.

    #2
    I wouldn't worry about the student loans when it comes to divorce proceedings because all 3 parties won't be able to discharge the student
    loan debt in a bankruptcy filing.

    The daughter might be able to do some programs for consolidation with the government loans. Not sure about them if they are private.

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