Can You File For Bankruptcy Without Involving Your Spouse?

You might be having some trouble paying your bills on time or even at all. It could be due to a job loss or an illness. A loss of income can be devastating to a family's finances. You may have tried to negotiate a payment schedule or even to consolidate your debt, but that action might have failed. You may have decided that bankruptcy is your only option.

While you may want to file bankruptcy due to your own finances, what if your spouse is in good shape? How will the bankruptcy affect them? Can you file for bankruptcy without involving your spouse?

Yes, you can, and it may not affect their credit score. It will depend on many factors. Contact a bankruptcy lawyer who can help you through the bankruptcy laws in your state. Here is how bankruptcy can work depending on which state you live in.

Only The One Who Files Will Have Their Debt Discharged

Depending on your state and the laws surrounding bankruptcy in your state, when a person files for bankruptcy, only the spouse who files will have their debt discharged. The other spouse will still owe any credit card debt, student loans, or any other debts they have. The bankruptcy filing will only appear on the filing spouse's credit report, and only their score will be affected.

However, if you have a credit card or line of credit in both spouse's names and one spouse files for bankruptcy, that credit card or line of credit will be discharged and the bankruptcy can now affect both spouse's credit rating. Before filing, check with the bankruptcy laws in your state and consult a lawyer to see which debts will be discharged and how bankruptcy will affect both spouses.

It Can Affect The Family's Assets

If the filing spouse owned property before they were married and it remains in their own name to this day, the debt discharge should only affect the property of the filing spouse. For the non-filing spouse, if they owned property before they married and the filing spouse is not on the title at the time of filing, the bankruptcy filing should not affect their property.

However, if you bought your home after you were married, that home is now the property of both spouses in some states, regardless of whose name is on the title. This is what is known as community assets. Those assets are affected by the bankruptcy filing regardless of who filed. Check with your state's bankruptcy laws to see if you live in a community asset state or not.