Are you considering declaring bankruptcy? Are you married?
If so, you may be wondering how it will affect your spouse.
The answer is complicated.
While filing for bankruptcy without your spouse is a possibility, it’s important to understand the impact that declaring bankruptcy can have on both you and your partner. Here’s what you need to know.
Declaring Bankruptcy Individually
When one spouse files for bankruptcy, the other spouse’s credit score isn’t immediately affected.
However, if joint accounts are involved, such as shared credit card debt or jointly owned property, the non-filing spouse will still be held responsible for any outstanding payments due after the filing date.
Additionally, if a creditor goes after the non-filing spouse for payment of debts related to their shared accounts, this could affect their credit score.
If both spouses decide to file for bankruptcy together, it can provide certain advantages when it comes to repaying debts and rebuilding credit scores. This is because filing jointly allows couples to take advantage of joint exemptions when liquidating assets. Plus, any remaining debt obligations may be divided between them according to each party’s financial situation.
For example, if one spouse has more assets and higher income than the other, they may be required to pay back more debt than their partner after they file together.
Moreover, by filing jointly, couples ensure that all eligible debts are discharged through the same process at the same time.
Finally, couples who file together often find that their post-bankruptcy credit scores begin rebuilding at roughly the same rate as well.
Should You File with or Without Your Spouse?
The simplest answer is “it depends.” Everyone’s situation is different. This is why it’s important to understand bankruptcy basics, but also speak to someone who can help you determine what’s best for you.
Declaring bankruptcy can have serious consequences, both financially and emotionally. It also impacts other people in your life. It might be the best decision for you, but it’s important to consider how it will affect your family.
Before you make any decisions about filing alone or with your partner, take time to assess your situation thoroughly. This might include consulting with a financial advisor or lawyer who specializes in bankruptcies and debt relief strategies.
It may be helpful to estimate your bankruptcy qualifications and cost. Feel free to use the calculator below for personalized results and pros and cons for Chapter 7.
An experienced professional will help you make an informed decision. You’ll know what’s best for both you and your partner in terms of getting out of debt. Bankruptcy allows you to begin life anew with financial freedom from creditors. An attorney will give you general information about bankruptcy. They’ll also assess your specific circumstances and explain how bankruptcy will help or hinder you.
For more information or to discuss the impact of bankruptcy on your spouse or other family members, contact the Law Offices of Robert M. Geller at 813-254-5696 to schedule a free consultation with an experienced attorney.