How does co-debtor stay work in Chapter 13 Bankruptcy?

Co-debtor stay is a tool provided in Chapter 13 Bankruptcy Law to protect co-debtors. It is a provision that prevents creditors from attempting to collect money from a co-debtor, even if the original debtor files for bankruptcy. Co-debtor stay is a provision of the federal Bankruptcy Code that is also recognized in the state of West Virginia. When a debtor files for Chapter 13, this provision prohibits creditors from attempting to collect debts from any co-debtors the debtor may have. This means that any creditors in West Virginia who is owed money by the debtor cannot pursue payment from any other persons who may have been listed as a co-debtor on the loan. The goal of this stay is to provide the debtor and the co-debtor with additional protection. When the stay is in effect, creditors will not be able to take any legal measures against the co-debtor to collect the debt. This allows the debtor and the co-debtor to have the time and space needed to figure out a payment plan with the court that is manageable for all parties involved. There are, however, some exceptions to this protection. For example, if the co-debtor was an authorized user on the loan, the creditor may be able to pursue collection from the authorized user, since they are legally responsible for the debt. So, it is important to be aware of how this law works in West Virginia and consult a lawyer if necessary if you have any questions.

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How does co-debtor stay work in Chapter 13 Bankruptcy?

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