Expert: Ontrack Financial Group llc - 6/4/2008

Question
QUESTION: I received a letter from an attorney in Utah saying I owe back debt for a boat a co-signed with my ex-husband back in 2000. In August of 2002 the divorce decree states he was to remove my name from the boat. In September of 2002 he stopped paying the boat. He was no where to be found and neither was the boat. He never showed up for the original divorce. I went over this with the original credit union. They understood I thought at the time. I have never heard from them again until today. June 2, 2008 They asked me to pay the 16,000 and send a letter of validation back within 30 days. The boat is reposed as listed on my credit. My ex claimed bank-ruptcy. What do I do? Should I respond to the letter? Should I wait for a summons? What are my chances of fighting this? Can they attach wages? I live in California now. My credit is good other than this bad mark. I understand Utah Sol is six years. Should I hire an attorney or save the money? and write my own letters. What is the likely hood of this case? Help

ANSWER: Kerry,

Since you co-signed the contract, your ex filed for bankruptcy, and the divorce decree has no precedence over the original contract.  You are liable for the debt.  However you can respond to the letter requesting proof of the debt.

Your chances of fighting this are small ( if the creditor still has the contract), however this debt may have been purchased by a collection agency since it's already 6 years old.  If is was, you may be able to fight it.  Please understand writing letters may not solve the problem, while an attorney will charge you 10-15% of the orginal balance.

Who is the reporting party on your credit report?

---------- FOLLOW-UP ----------

QUESTION: The credit union that financed the boat, and a lawyer representing them. I spoke with my original attorney who handled the case, and she said to not answer the letter. And to wait until it has to go through court proceedings, but not to let it go into default? Also can garnish my wages are view my checking account and savings account? Also my bank said they are reporting the account as closed.

Answer
"Also can garnish my wages are view my checking account and savings account?"  <----  please be clear on what your asking.

The account is already in default it's almost 6 years past due.  If the bank is the reporting party the account wasn't purchased by a collection agency.  The statue of limitations are almost over.  ( The time starts from the last payment made on the account ) However the creditor may be ramping up to file judgment before the SOL expires.