Make payments on mom's car

Dear Terry,
My wife's mother co-signed for a car. My wife drove the car for a year while making payments. Eventually, her mother took over the payments on good terms.

Her mother then went into bankruptcy without telling my wife. Her mother still has possession of the car and my wife's credit rating has gone down for the last four months. What do we do?
-- Cory

Dear Cory,
If possible, you need to bring the payments current. Your wife is ultimately on the hook if her mother defaults on the payments. Then, depending on how the car is titled, your wife needs to take possession of the car and make sure its insurance is up to date.