Can Someone Else Assume Responsibility For My Debts?

The short answer, is yes, though the reality of passing off the responsibility of your debt(s) can be a little more complicated. There are a number of ways for a third party to assume responsibility for your debts – both on a formal basis and an informal basis. But beware, the informal options could leave you solely responsible in the end. The best way to stop your ongoing liability for your debts is to look toward a “formal” option which obtains the creditors’ approval.

Informal Options:

There may be someone who has agreed to repay your debts for you. If they have paid your debts in full, you may have assumed legal responsibility to repay them, unless they agree that the repayment was a gift to you with no repayment to them required.

If a third party has voluntarily agreed to make monthly payments to your creditor(s) on your behalf, you will remain legally responsible to those creditors until the debt has been paid in full. If the third party ceases to make their voluntary payments, they will have no legal responsibility to those creditors (unless they signed a new contract with your creditor) and your creditors will look to you for continued payments.

In marital breakdown circumstances, the Court may order that one spouse is required to assume responsibility for payment of certain creditors. If both spouses were jointly legally obligated to repay those creditors, they will both continue to be responsible for the debt repayment, notwithstanding the Court order.

Formal Options:

In order to remove any future liability you have for your debt(s), another party will be required to assume sole legal responsibility for them. The creditor(s) will generally require that the new party qualify to take the debt over, by completing an application form and meeting their standard lending criteria. Ideally, you will want to obtain written confirmation from the creditor that you are no longer legally responsible for the debt.

Alternatively, a third party may obtain their own new financing at the same creditor or a new creditor of their choice. Once your debt(s) have been paid in full by the new financing, you will no longer be liable for the debt, provided you did not co-sign the new loan.

Summary:

In summary, another individual cannot generally assume legal responsibility for your consumer credit without you remaining liable for it. The exception is where they have paid your debt in full (and you did not co-sign their new financing) or where they have qualified to do so with your creditor and that creditor has released you from further responsibility in writing.

You should also be aware that if a co-signer of your debts had agreed to assume responsibility for your debts and they subsequently file bankruptcy or a Consumer Proposal when you had not been previously released from responsibility, your creditor will then look to you for full liability of those debts. If you find yourself unable to pay your debts, there are several debt solutions available to you – depending on your personal situation and financial needs.