I do not know if this question is germane to finance -- it really has to do with credit...but maybe someone knows the answer or can tell me whether the question fits in a different, more appropriate category. If my mother cosigned for a car loan with me, then died, is my father responsible for the debt, and will his credit get scarred if I default on the car loan (ie get the car repo'd)?
Country/State/Province of question: CA
No. Your father is not responsible for the debt, unless he co-signed as well. The loan should not show up on his credit report or impact his credit rating. The bank has no recourse on your father, although they could have recourse on your mother's estate if she had significant assets.
Ah, well now that could be what he is concerned about then...yes, she had a considerable estate...more than enough to pay off the car, lol...and it was actually in a "living trust" of sorts, consisting of her estate and my dad's, who's still living. That is, it Was...but the paperwork strangely vanished after she passed, leaving everything in a kind-of limbo situation...supposedly she and my dad were trustees, then when she passed I would have become a trustee...I am not sure what happens to the whole thing, since there's no longer any paperwork to be found on it...I guess the whole estate just passes to my dad and he can do what he wants in terms of recreating the trust or not...but I wonder how that would affect creditors trying to collect on a debt tied to her estate?
Both during life and after the grantor's death, all his assets held in the living trust are subject to lawful debts.
A lot of things must happen before a creditor can get a judgment or seize assets.
I can't guarantee that the creditor won't be able to seize any assets that were your mother's. However, anything that is in your father's name cannot be touched - and his credit rating will not be impacted.
If you are concerned about what will happen if you default, and your father is concerned that you will have to pony up some of your late mother's assets, have him give the lawyer that drew up the living trust a ring and he should be able to give you a more definite answer since he knows more about how your assets are structured.
TN CPA with Master's degree from Ole Miss