Cosigned loan question

[sdedalus83]

I currently have about $38k in unsecured debt, along with two mortgages and a vehicle loan totaling $145k. The combined appraised value of the home and vehicle is approximately $137k, so I have no equity in my secured debt, and the last year and a half have seen my income decrease by approximately 20%, and my medical expenses have increased dramatically. With my current income and expenses, I've been able to cover all the minimum payments on my debt and all my living expenses, with about $150 to $200 a month in discretionary income. Unfortunately, health problems are probably going to force me into requesting short term disability payments by the end of the year, transitioning into unemployment payments when my employer terminates me at the end of that period.

Since I know that I will no longer have sufficient income to repay the debts I have, and am unsure of when or if I will be able to return to full time employment, I am currently researching my options for filing for Chapter 7.

The question I have today is with regard to two lines of credit I have with one bank. I have one line with approximately $2100 in available credit which is entirely in my name, and a second with a $3000 balance with my son as a cosigner. With my current income situation my son has been paying the minimum payment on both accounts to help me have some cushion should a medical emergency arise.

Should my son increase payments to the cosigned account to quickly get the total balance to less than the available credit on the account in my name, would I be violating any rules by rolling the remainder of that balance into my other line of credit prior to filing for Chapter 7?

[newbie2]

The question I have today is with regard to two lines of credit I have with one bank. I have one line with approximately $2100 in available credit which is entirely in my name, and a second with a $3000 balance with my son as a cosigner. With my current income situation my son has been paying the minimum payment on both accounts to help me have some cushion should a medical emergency arise.

Should my son increase payments to the cosigned account to quickly get the total balance to less than the available credit on the account in my name, would I be violating any rules by rolling the remainder of that balance into my other line of credit prior to filing for Chapter 7?

Yes, if your son pays down the $3000 line of credit by $900 so close to your filing the trustee could claw that money back from the bank. Check with an attorney, but I don't believe it makes any difference whether you actually make the payment or your son does. The loan is still in your name also and would be included in your bankruptcy.

[Justdonewit]

If you roll over the balance to the other line within 70 or 90 days (can't remember which number it is for balance transfer) of filing, you will not be able to discharge that amount. If you search the boards for the 70/90 day rules, you will find a lot more information. Good luck to you.