Marriage and Bankruptcy: Can You File Individually if You’re Married?

For richer or poorer, in sickness and in health, ‘til death do us part … For a married couple experiencing grave financial difficulties, the first part of the wedding vows definitely comes to mind. Filing for bankruptcy is never an easy decision to make, particularly if you’re married and have a family. But in the unfortunate event that you are left with no other option but to call a Los Angeles bankruptcy attorney, can you file for bankruptcy individually and does this have a negative effect on your husband or wife?

Thankfully, spouses are not required by the law to file for bankruptcy as a couple. A married couple can file for joint bankruptcy in the same way that they can file for a joint tax statement but they can choose to file for individual bankruptcy as well. In California, bankruptcy law dictates that whether you file alone or together with your husband or wife, all community property is considered as part of your bankruptcy estate. A bankruptcy trustee will liquidate the community property to pay your creditors before you can be granted a bankruptcy discharge. In common law states, only a property that is owned jointly can be used to pay creditors. If the non-filing husband or wife holds an individual asset, he or she does not need to worry about losing anything at this time.

‘Til Debt Do Us Part?

If you ask a Los Angeles bankruptcy attorney to file for bankruptcy on your behalf, this will have no negative effects on your husband or wife. Your bankruptcy case will not show up on your husband or wife’s credit reports. This means that your bankruptcy should not hurt their chances of getting a loan in the future. He or she also doesn’t need to explain what happened to his or her boss. However, if you file for bankruptcy alone, that still leaves your non-filing husband or wife responsible for his or her share of any debts that you have jointly incurred. If you are discharged, your husband or wife will still have to take responsibility for the debts. If a loan is left unpaid after a Chapter 7 or a Chapter 13 bankruptcy has been filed by your Los Angeles bankruptcy attorney, your husband or wife will be negatively affected.

For those of you who are engaged to someone who has filed for bankruptcy or thinking of filing for bankruptcy, you might want to wait until the bankruptcy judgment is final. If your future spouse goes Chapter 13, he or she won’t discharge his or her debts, and even if he or she asks a Los Angeles bankruptcy attorney to file for Chapter 7 bankruptcy, not all debts are discharged.