I am in the process of filling for a Ch. 13 bankruptcy in CA. Just found out that one of the credit cards has my ex-wife as a joint owner, not an authorized user, on the account. I tried removing her, but they said I can't because she is an equal owner of the account. She doesn't live in the US anymore and I know in Ch. 7 they might go after her, but how does it work in Ch. 13? I did a little bit of research and it says that in Ch. 13 if I continue making the court arranged payments that the creditor can't go after her. Technically, they can, but they would have to meet some criteria. Can someone advise on this? Thanks!
The Chapter 13 Codebtor Stay Protects Cosigners and Joint Account Holders
If you file for Chapter 13 bankruptcy, a codebtor stay immediately goes into effect and protects cosigners and joint account holders on all consumer (non-business) debts. As long as the codebtor stay is in effect, your creditors are prohibited from attempting to collect their debts from your cosigners or joint account holders even though they did not file for bankruptcy themselves.
However, your creditors may be able to obtain court permission to lift the codebtor stay if any of the following conditions are met:
Your cosigner or joint account holder received the consideration or primary benefit from the creditor’s loan.
Your Chapter 13 repayment plan does not propose to pay the cosigned debt.
The creditor’s interest will be irreparably harmed if the codebtor stay remains in effect.
Further, the Chapter 13 codebtor stay will end if your case is closed, dismissed, or converted to a Chapter 7 bankruptcy.
My posts are JMHO. I DO NOT claim to be a FICO expert. Just sharing my experiences from rebuild to recovery after BK DC. My siggy is not to brag at all. Just to show fellow members what can be accomplished when you do it right and play the FICO Credit Game.