Will My Bankruptcy Affect My Spouse?

Filing for bankruptcy without your spouse won't affect your spouse's debt obligations but could affect your spouse's property and more.

By , Attorney

You might wonder if you can file for bankruptcy without your spouse and if you do, how it will affect your spouse. The simple answer is that one person in a marriage can file for bankruptcy. However, your spouse will be involved in the bankruptcy, even if you file alone.

For instance, did you realize that filing without your spouse won't help you get around a bankruptcy qualification problem? It's true—you'll still have to report your spouse's income. But that's not all. Filing without a spouse can also affect:

  • your spouse's credit and debts, and
  • joint and separate property.

After deciding whether to file bankruptcy with or without your spouse, brush up on some of the other important things you should know about a bankruptcy filing. And be sure to check out our quick ten-question bankruptcy quiz. It can help you spot potential bankruptcy issues fast.

Can I File Bankruptcy Without My Spouse?

Yes, you can file for bankruptcy without your spouse, and it's a good idea when most of the debt is in your name alone. Your spouse will be able to maintain a good credit score and will be able to file for bankruptcy in the future if needed.

However, you must include your spouse's income on the means test when qualifying for Chapter 7 bankruptcy. But you can deduct earnings used for debts that don't benefit your household, such as your spouse's alimony payments to a spouse from a previous marriage and expenses related to maintaining two homes.

Your bankruptcy filing can also affect your spouse's property. Speaking with a bankruptcy lawyer is the best way to ensure your spouse's assets are protected.

Will Filing Bankruptcy Affect My Spouse's Credit?

Typically, no. And it's fortunate because preserving one spouse's good credit for future expenditures is a sound financial strategy. It's also one of the factors married couples consider when deciding whether to file for bankruptcy jointly or if only one spouse should file for bankruptcy.

However, filing bankruptcy without your spouse doesn't always work well. You'll likely want to file together if most of your debts are joint debts and your spouse doesn't need financial relief from separate obligations.

What Happens to My Spouse's Separate Debts If I File Bankruptcy?

Your bankruptcy discharge will eliminate your responsibility to pay debts. Nothing more, nothing less. A spouse will remain responsible for obligations in their name.

Will My Spouse Have to Pay Our Joint Debts After I File Chapter 7 Bankruptcy?

Yes. Your Chapter 7 case will wipe out your obligations. It won't erase your spouse's responsibility to repay any credit balances you took out together.

For instance, suppose the Visa card you opened jointly has a balance of $1,000 when you file for bankruptcy. After your bankruptcy, you'll owe nothing. Your spouse will owe $1,000.

Will My Spouse Have to Pay Our Joint Debts During Chapter 13 Bankruptcy?

Probably not. The Chapter 13 automatic stay stops creditors from coming after your codebtors, including a spouse. If you don't pay off the joint debt in your repayment plan, a creditor might ask the court to lift the codebtor stay. If that doesn't happen, your spouse should plan to pay any balance remaining after Chapter 13.

Will My Chapter 7 Bankruptcy Affect My Spouse's Interest in Our Joint Property?

Yes—at least the property you own together. If you can't fully protect jointly-owned property with a bankruptcy exemption, the Chapter 7 trustee will likely sell it for the benefit of creditors.

After selling the property, the Chapter 7 trustee will return the bankruptcy exemption amount to you. But what will happen to your spouse's interest will depend on the following:

  • If you live in a common-law state, your spouse will likely receive the value of the spouse's interest.
  • A spouse in a community property state won't receive half the value of your jointly-owned property. The trustee can use all nonexempt community property to pay off your debts.

Anything remaining after the trustee deducts sales costs and the trustee's fee goes to creditors.

Will My Chapter 13 Bankruptcy Affect My Spouse's Interest in Our Joint Property?

No, because Chapter 13 trustees don't sell property. However, the trustee will factor your interest in nonexempt property into your case using the system described above, and it can drive up your monthly payment amount fast. Why? Because if you want to keep a nonexempt asset in Chapter 13, you must pay an amount equal to its value in the Chapter 13 repayment plan.

Will My Bankruptcy Affect My Spouse's Separate Property?

It can. Because this area can get tricky, a local bankruptcy lawyer will be in the best position to review your assets and formulate a strategy to meet your needs.

Navigating Your Bankruptcy Case

Bankruptcy is essentially a qualification process. The laws provide instructions for completing a 50- to 60-page bankruptcy petition, and because the rules apply to every case, you can't skip a step. We want to help.

Below is the bankruptcy form for this topic and other resources we think you'll enjoy. For more easy-to-understand articles, go to TheBankruptcySite.

More Bankruptcy Information

Bankruptcy Forms and Document Checklist

Schedule A/B: Property

Schedule C: The Property You Claim as Exempt

Schedule D: Creditors Who Have Claims Secured by Property

Schedule E/F: Creditors Who Have Unsecured Claims

Schedule H: Your Codebtors

Chapter 7 and 13 Bankruptcy Form List

Bankruptcy Document Checklist

More You Might Like

What Happens to My Cosigner in Chapter 7 Bankruptcy?

What Happens to My Cosigner in Chapter 13 Bankruptcy?

How Is Joint Property Treated in Bankruptcy?

How Much Debt Should I Have to File for Bankruptcy?

We wholeheartedly encourage research and learning, but online articles can't address all bankruptcy issues or the facts of your case. The best way to protect your assets in bankruptcy is by hiring a local bankruptcy lawyer.

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