Financial difficulty can put a lot of strain on a marriage. If you have a lot of consumer debt, medical bills, or you cannot catch up after losing your job, you and your spouse may want to consider bankruptcy. If you are married, you have to know how the process works and what your options are. Here are some things you need to know if you want to file as a married couple:
Do You Have to File Jointly?
Although it varies from state to state, most often married couples do not have to file for bankruptcy jointly. This is different in community property states, however. If one of you has large assets in your own name and you do not want to lose them in a bankruptcy, the other can file alone without the other.
Is the Entire Household Income Used in a Bankruptcy Filing?
If you are married but one of you files independent of the other, the court will typically take your entire household income and expenses into consideration, even if your spouse is not filing. This is done to ensure your bankruptcy filing is correct. Trustees have to look through your debt to ensure one of you is not actually responsible for the debt, even if it is in the other person's name.
For instance, if your spouse is a fan of sports memorabilia and the bills clearly show that is what some of your debt is, and the debt is on a credit card with your name one it, your spouse may have to take responsibility for it even if you are the one filing for bankruptcy. Each case of bankruptcy is different and complex. For this reason, you definitely need to discuss each of your debts with your bankruptcy attorney prior to moving forward.
Can Each of You File Independently?
If you are both in debt but keep everything separate, it stands to reason that you will want to file for bankruptcy separately as well. This can be done, but there are some exceptions. If one of you co-signed on a loan for the other, one of you cannot discharge that debt. You have to file jointly to do that. If your debt is mostly debt accrued as a married couple, you might want to consider filing together, as it will make the process more straightforward.
Filing for bankruptcy can be a complicated matter, so be sure to work with bankruptcy attorney services from the beginning to ensure you are on the right path.