Can only one spouse file?
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Can only one spouse file?
Asked on November 17, 2012 under Bankruptcy Law, Colorado
M.D., Member, California and New York Bar / FreeAdvice Contributing Attorney
Answered 10 years ago | Contributor
Yes, only one spouse can file for bankruptcy. In fact, if they are the only partner that owes debt, then only they should file. However, debts for which spouses are joint and liable will remain with the non-filing spouse.
Under Chapter 7, where one spouse’s debts are discharged, the creditor can go after the other spouse. In a Chapter 13, where the debtor plans to re-pay their debts, the creditor will leave the co-debtor alone, as long as plan payments are deposited on time.
While the bankruptcy of one spouse does not generally affect the other, there are some exceptions. For example, the bankruptcy of a spouse may show up on the other’ spouse's credit report for a joint debt. Also, generally much of the debtor’s "non-exempt" property is taken by creditors and if that property is jointly held, it can also be taken away. This is of special significance in a community property state because both spouses own and are responsible for all the debt and property acquired during the marriage. So after the community property is taken away, any property then acquired by the non-filing spouse is no longer accessible to their creditors. This means that any joint debts discharged in the bankruptcy of an individual spouse also applies to the non-filing spouse. Therefore, the non-filing spouse in a community property state enjoys an advantage from their spouse’s bankruptcy since from that point creditors can only go after the non-filing spouse’s separate property (i.e. property acquired by gift during marriage and by inheritance or pre-marital property).
eric redman / Redman Ludwig, P.C.
Answered 11 years ago | Contributor
one spouse can file. that person discharges his/her debts. the other spouse stil owes of of her/his debts.
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