It’s a question that comes up on a pretty much daily basis. After performing an assessment of the situation, a person decides that bankruptcy is the best option to deal with his or her debts. Then the question, “How will my bankruptcy affect my spouse?
The answer is not the same in all situations. Bankruptcy releases a person from the legal obligation to pay his or her debts. If your spouse is not jointly responsible for your debts, your bankruptcy should have no effect on your husband or wife. The most important thing to understand is that your spouse is not responsible for your debts because you are married.
So the next question should be, how do I know if my spouse is jointly responsible for my debts? First off, a joint debt means that two or more people are 100% responsible for that debt. That means that if one person is unable to pay, the other person or people will be required to pay.
There are different ways that joint liability can be established. If your spouse has co-signed or guaranteed your debt, it is clear cut: your spouse is also responsible for that debt and the bank will try to collect from them.
Another possibility is that your spouse has a supplementary credit card on an account that you opened. In that situation, it is less clear. It comes down to the fine print in your cardholder agreement.
If you find yourself in a difficult financial situation and are unsure of how to proceed, you can give me a call at 310-PLAN. You can also send me an e-mail with your questions.
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