Will Sallie Mae attach cocial security for co-signed student loan?
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Will Sallie Mae attach cocial security for co-signed student loan?
My dad co-signed for a student loan many many years ago for his granddaughter. He has not communicated with her for sometime and she does not respond to calls or email. He just turned 88 and his only source of income is social security. He has no personal property or monies. If he is placed in a care facility, does he still have to pay for the loan? Or is there away he can get out of this agreement? Or how do I find out what will happen if he stops paying? What other options might he have?
Asked on January 18, 2012 under Bankruptcy Law, California
Answers:
FreeAdvice Contributing Attorney / FreeAdvice Contributing Attorney
Answered 12 years ago | Contributor
If your father co-signed on a student loan for a granddaughter, there is the possibility that if the granddaugter does not stay current on this loan the lender may seek payments from him for the amount due and even file a lawsuit against him.
Social security checks are exempt from from judgment levy by a judgment creditor. However, if the checks are placed in a regular bank account or checking account, they lose their exemption from levy.
I suggest that your father give you a power of attorney where you open a bank account in your name as his attorney in fact and deposit the social security checks in that account. By doing this you safe guard a flow of income and retention to him in the event that he is sued by the lender on the loan he co-signed for the granddaughter. I suggest that you consult with a Wills and trust attorney for the suggested power of attorney.
If the granddaughter fails to pay on the student loan, your father as the co-signer on the loan is obligated to pay on it.
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