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  • Options for Cosigners of Defaulted Loans (Part 2)

    If you are a cosigner of a loan that has been defaulted on, refinancing the loan or filing for bankruptcy may be your best options if you can’t make the payments.

    If you are a cosigner of a loan that has been defaulted on, refinancing the loan or filing for bankruptcy may be your best options if you can’t make the payments.

    As a follow up to Your Options if You Cosigned a Loan That Has Been Defaulted On (Part 1), here are some additional tips for cosigners regarding what they can do if their loved one has defaulted on a loan. It’s important to point out that some of these options have a downside but that they can ultimately help you climb out of debt if you are financially responsible and are diligent about following through with them.

    • Consider refinancing the loan – One option for refinancing the loan involves attempting to refinance the cosigned loan with the other borrower. On one hand, this can help lower the monthly payments, which may get them down to a number that the other borrower (or you as the cosigner) can now afford to make on time. However, if the other borrower is still unable to make even these lowered monthly payments, you could now be stuck making more interest payments and ultimately paying more money than you would have before refinancing the loan.
    • File for bankruptcy – If you are facing credit card debt, healthcare debt or other debt that has put you in a position of not being able to pay off the cosigned loan, you are likely overwhelmed by debt and may want to seriously consider filing for bankruptcy. Although bankruptcy will not discharge all of your debt (such as your student loan debt or any court-ordered payments handed down to you), it can help you discharge a large amount of debt, which may free up funds to pay off the debts that have not been discharged by bankruptcy.

    If you are struggling with debt and are looking for a financial fresh start, contact the trusted Colorado bankruptcy lawyers at The Law Office of Andrew McKenna. For more than 20 years, we have been successfully overseeing our Clients’ bankruptcy cases so they can resolve their financial issues as beneficially as possible. Our comprehensive legal knowledge coupled with our vast experience allows us to consistently and efficiently help our Clients achieve the best possible resolutions to their financial matters. For an evaluation of your case and expert advice regarding how to move forward, call us at (303) 730-8819.

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