Should My Wife Stay Out of the Bankruptcy Case to Save Her Credit Rating?
By Craig Andresen, Attorney at Law on Oct 25, 2009 in Featured, General Bankruptcy Information
This question comes up often in a bankruptcy lawyer’s office, and each time it does the answer is nearly always the same: no.
Of course, this question could just as easily be asked the other way, should the husband refrain from joining in his wife’s bankruptcy? The question is based on the perception that the family needs credit to survive, and that it will hard to get credit unless one of the spouses stays out of bankruptcy.
The fact is that it’s usually easier to get credit after bankruptcy if both spouses join in the case. If one spouse doesn’t file bankruptcy, that spouse might still be burdened by debt payments later, making it more difficult to join in an application for future credit. Also, it’s much easier to obtain credit after filing for bankruptcy than most people think.
If one spouse stays out of the bankruptcy, the effectiveness of bankruptcy’s fresh start is degraded, as one of the spouses will have to continue diverting some of the family’s resources to making payments on old debts. There may also be a corrosive effect on the marriage as one spouse goes through an important court process that the other avoids without having good cause: the shared financial enterprise of the marriage is no longer “shared” in that respect.
Unless your lawyer identifies a good reason for only of the spouses to file bankruptcy, doing it together is almost always the best idea.
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