Usually spouses file for bankruptcy together. So in most cases, a spouse would still be responsible for debts if their other half filed. Bankruptcy attorney Benjamin Ginter runs the Law Offices of Benjamin J. Ginter in Cranford, New Jersey. Here, he explains what married couples need to know.
If one spouse files for bankruptcy and the other does not, the one who does not file could possibly be responsible for the debts if he is a co-debtor. But of course the benefit is that one of the spouses will not have the negative credit mark of a bankruptcy on his credit report.
Your spouse only has to file if he is a co-debtor on the credit card. Or if he has his own debts which he’d like to discharge as well. A spouse is not required to file, however, if he is a co-debtor on an account that his husband or wife is trying to discharge from bankruptcy. But in that case, he will still remain liable for that debt.
So if one person files and not the other, and the two are co-debtors, then the one person who does not file will still be liable, and he will still have to pay that debt. This is why married couples almost always file together. Another reason is because their debts are [usually] jointly owned, so they know if one files and not the other then the one who doesn’t file will have to pay the debt.
Fifty-Fifty
It is not required that married couples file together. If you have one spouse that has a lot of debt but the other spouse does not have any debt and is not liable to the other person’s debt, that means he doesn’t have to file. If your house is in both of your names and one of the spouses does not want to file, then the trustee will look at the filing spouse’s plea and make it 50-50.
So let’s say a husband files for bankruptcy, but the wife does not. And it turns out that after you take the value of the home and conduct all the liens, the exemptions, things of that nature, you then come up with $30,000 of equity. The filing husband is entitled to $15,000 of that equity, not $30,000. The filing spouse is only entitled to 50% of that.
Joint Petition
Please keep in mind that a joint petition is the filing of a single bankruptcy petition by an individual and the individual’s spouse. Only people who are married on the date they file may file a joint petition. Unmarried partners must each file a separate case.
