How are debts that have been co-signed or guaranteed by another person handled under Chapter 13?
If a consumer debt which has been co-signed or guaranteed by another person is being paid off in full under the Chapter 13 plan, the automatic stay that was entered when the case was filed will prevent the creditor from collecting the debt from the other person. However, the creditor may ask the Court’s permission to collect from the other person the portion of the debt that is not being paid off under the plan. The Trustee will only pay in full those co-signed debts that are specifically provided for in your plan. Please call your attorney if you have any questions.
