Gurantor & Help!!

Years_of_debt

Hello,

I have a loan which I make payments on each month. I haven’t missed any payments so far. I have found out that my gurantor is filing for Bankruptcy. Will that cause me any issues?
If they are the gurantor for the loan does that mean I can simply stop paying and the debt would be wrote off?

Am I still liable to keep paying each month even know the gurantor has gone bankrupt?

If I did stop paying what would happen?

Thanks For any help!

DCFC79

Years_of_debt wrote: »

Hello,

I have a loan which I make payments on each month. I haven’t missed any payments so far. I have found out that my gurantor is filing for Bankruptcy. Will that cause me any issues?
If they are the gurantor for the loan does that mean I can simply stop paying and the debt would be wrote off?

Am I still liable to keep paying each month even know the gurantor has gone bankrupt?

If I did stop paying what would happen?

Thanks For any help!

If you were to stop paying I would imagine they would still chase you for the money, why would you stop paying. Does the agrrement mention anything about the guarantor filing for bankruptcy ?

Craig1981

Hi


My opinion:
as you have not defaulted, the liability for your guarantor has not become live/active. If they go bankrupt and you stop paying (unsure why?), then they will chase the guarantor for the payments. As it them becomes liable after their bankruptcy has been put into place, it will remain liable and not be included in the bankruptcy


I would continue to pay until cleared

Paul_DNAP

Yes, it is always better if you pay it off. Even if they were not successful in chasing you or your guarantor for the outstanding balance, the record of you stopping paying and defaulting on the loan will haunt your credit file for many years.

Caz3121

Years_of_debt wrote: »

I have a loan which I make payments on each month. I haven’t missed any payments so far. I have found out that my gurantor is filing for Bankruptcy.

https://forums.moneysavingexpert.com/discussion/5892294/38k-bankruptcy
In your previous post you were the guarantor and were planning to go bankrupt.

Years_of_debt

Thanks for the advice.
Asking for a friend just to clear it all up

Craig1981

based on your other post:
https://forums.moneysavingexpert.com/discussion/comment/74776751#Comment_74776751.


If you go bankrupt as well as your guarantor, they will chase your guarantor as previously stated.
and I assume that if liability shifts from you to them AFTER they have declared bankruptcy, they will continue to chance them as debt will be live.


unsure if it will affect bankruptcy payments etc either - would suggest contacting Stepchange or National Debtline to get ALL your information and concerns out in one conversation, and you'll get proper advice from there

Caz3121

Years_of_debt wrote: »

Thanks for the advice.
Asking for a friend just to clear it all up

so are you asking what happens if they stop payment on a loan that you are a guarantor for? why would you think they would stop paying?

Years_of_debt

Don’t worry Craig1981 has answered everything perfectly. Thanks Craig

ToxtethO'Grady

Bankruptcy includes contingent liabilities, and being a guarantor is one so your guarantor is no longer liable and cannot be chased

Craig1981

yeah, was interested in this question last night and did some more research :
from bankruptcy clinic :
""What about if the guarantor goes bankrupt?

Turning to the other side of the coin, let’s consider what would happen if your guarantor runs into financial trouble during the loan’s term (assuming you’re keeping up with the repayments at this time). If this happens and they become bankrupt, their liability to repay the debt will come to an end and you’ll be expected to keep making payments as usual.



If you later find that you can no longer afford these payments, your guarantor still won’t be liable for the loan as they’ll be protected by their bankruptcy – even if they’ve already been discharged. If their Bankruptcy Order is still in place, the OR will simply contact the lender who’ll deal with the situation on their behalf"""