If you are married and have already come to the determination that filing for bankruptcy would be the best solution to help you get out of debt, the next question you have to ask yourself is whether you will be filing alone, without your spouse, or filing jointly, with your spouse. For a married person, filing bankruptcy alone has its benefits, but it also has its drawbacks. You'll need to talk to an experienced lawyer to help you decide the best solution for you.
Benefits of Married Person Filing Bankruptcy Alone
One of the main benefits of filing bankruptcy alone, without your spouse, is that your spouse does not have to be involved in the legal proceeding. If your spouse has excellent credit and you don’t, your spouse may want to maintain their excellent credit by not being a part of your filing. You will still have to disclose your spouse’s income for purposes of establishing your household income but this is only relevant to determining whether you, by yourself, qualify to file. If, for example, your spouse earns $200,000 per year, you likely would not qualify for bankruptcy relief, regardless of your income, because the Court would say that your household income is too high and with the help of your household income you can afford to repay your debts.
Small Amount of Debt
Also, if your spouse has a very small amount of debt in comparison to your debts, for example you have $20,000 in credit card debt and your spouse has only $2,000, your spouse may want to just repay her credit cards so that he or she does not have to join in your bankruptcy. That way, the one of you with the larger amount of debt can file and then use the other spouse’s good credit for the next few years while you rebuild your credit.
Another benefit of filing bankruptcy alone is that, in certain cases, the filing of a bankruptcy and obtaining a discharge by a married person will provide both of the married couples with all the protection they need. The rule of law regarding a discharge protecting married couples is quite complex and discussion of that rule is beyond the scope of this blog. Proper analysis truly requires discussing your situation in great detail with an experienced attorney. In many cases, the filing of a bankruptcy by one married person can fully protect both spouses. Under an appropriate set of facts, which must be fully and properly analyzed by a lawyer, the filing of a bankruptcy by one married person can protect both married persons even though only one spouse files and the other spouse is not involved, at all, in the legal process or proceedings.
The Drawback of Married Person Filing Alone
The main drawback to a married person filing alone is that the non-filing spouse may not receive the same protections he or she would have received had both married couples filed together. Much of this depends on the nature of the debts involved as well as the type of bankruptcy that is filed. Depending upon your situation, filing without your spouse many not fully protect your spouse and he or she will continue to receive harassing phone calls from debt collectors and may even be sued during the pendency of your bankruptcy.