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Law Offices of Ronald W. Rutz
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April 6, 1998: Co-Signer Responsibilities; Joint Tenancy and Probate

Q: I co-signed for a friend on a car loan. She had an accident, totaled the car, and the insurance was less than the car loan. The lender is now demanding I pay the balance.

A: Unfortunately, whenever someone co-signs, he or she is obligated under terms of the document just like the primary party. It does not matter that you were just helping a friend and that you never really benefitted from the transaction. The lender is within its right to demand payment from you. Your friend is liable to you for what you are forced to pay but it appears your friend has no resources. Thus you might want to either get a judgment against her or have her sign a promissory note and then wait until she can start paying.

Q: My husband died and all of our property is in joint tenancy. I was told at a seminar sponsored by my company that because he had a Will, I must probate.

A: First, I want to extend my condolences. If everything was either in joint tenancy or, such as with insurance, had an effective beneficiary designation, you do not need a court proceeding whether there is a Will or not. Be sure to order enough death certificates (I normally recommend ten). Next make a list of all the assets held in joint tenancy or that he owned but which had a beneficiary designation. Then it is a matter of contacting each entity to determine the required paperwork necessary to have the title placed in your name or the proceeds paid. Be sure to leave one checking account in both of your names for at least six months so that if you receive a check made out to him, it can be deposited using a teller's endorsement. Also be sure that your husband's name on the death certificate matches his name on your deed. If it does, then all you need to do is record the death certificate. But if there is a variation, such as the full middle name on one document and only a middle initial on the other, then in addition to recording the death certificate, a simple name variant affidavit needs to be prepared and recorded. A new deed to you is not required.

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