My Husband (or Wife) is Filing a Bankruptcy…How Will It Affect Me?

When your spouse files a bankruptcy it could affect you in several ways.  In January, Atlanta bankruptcy attorney Jonathan Ginsberg wisely suggested on these pages that a non-filing spouse should consider hiring her own lawyer.  In a series of articles, I will discuss several matters that should be considered if your spouse is filing for bankruptcy.

The first question I always ask in this situation is should you consider filing also?  Many attorneys charge the same amount whether one or both spouses file.  Sometimes only one spouse files and then a few months later the other has to file, incurring nearly double the legal and filing fees.

I often hear that the husband wants to file because his debts are out of control, but the wife can handle her debt load.  Often his debts are the result of a failed business, and hers are typical credit card debts and bank loans.  She has managed to stay current on her debts, but he has not.  She would like not to file bankruptcy because she wants to preserve her good credit.

I look at the household income and expenses to see if they can pay all of their ongoing living expenses and continue to pay her debts.  I will also check their credit reports to see if any of his debts are also in her name.  If so, she will continue to be liable for those debts, and his falling behind will have already negatively affected her credit score.

In order to make an informed decision as to whether you should join your spouse in filing a bankruptcy, you need to consider the many ways your spouses bankruptcy could affect you.

Next: How your spouses chapter 7 will effect your real property.