What will happen if my ex-husband and I divorced a year ago and I was awarded my vehicle but the loan is in both of our names and now I’m filing for bankruptcy?

UPDATED: May 6, 2015

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What will happen if my ex-husband and I divorced a year ago and I was awarded my vehicle but the loan is in both of our names and now I’m filing for bankruptcy?

I am looking into filing for bankruptcy and including the auto lease as part of the bankruptcy. How will this affect my ex-husband with his name still being linked to the auto lease? The divorce decree clearly states that I was awarded the vehicle.

Asked on May 6, 2015 under Bankruptcy Law, Texas


B.H.F., Member, Texas State Bar / FreeAdvice Contributing Attorney

Answered 7 years ago | Contributor

You were awarded the vehicle, which means the vehicle is yours subject to the obligations you accepting in the divorce or that you were awarded via a final hearing.  Even though you were each assigned obligations, the lease company was not a party to the divorce action.  This means they are not bound by any orders that are contained in the decree and both of you will be liable on the obligation until one of your names is removed from the obligation.  So.... if you file for bankruptcy and there is a default on the obligation, any non-payment could affect his credit history.  If the lease/debt is paid through the bankruptcy court without any major lapse in payment, then it shouldn't affect your ex-husband too much, because the account is being paid.  If the account is being discharged, then it could affect his credit negatively, just as it would affect your credit history--- because you are both tied to the account.  If you don't want to affect his credit, then you need to get his name off the lease before you file.  If you don't and he is affected, then he could potentially sue for your failure to uphold your obligations if you violated any conditions of the decree which resulted in a financial harm to him.

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