My Spouse Is Considering Filing For Bankruptcy – How Will That Affect Me?

Posted in Personal Bankruptcy
Posted by Benny Mendlowitz, CPA, CIRP - LIT

spouse-filing-for-bankruptcyYour assets and liabilities are separate from those of your spouse. They will not be affected by your if your spouse files bankruptcy.

Where it becomes complicated is when you and your spouse have liabilities in common. For example, if you and your spouse both signed for your line of credit, then your spouse will be relieved of their responsibility to repay that loan by filing for bankruptcy, but you will not. You will have to repay the loan in full.

It can really become complicated when you and your spouse own assets jointly. For example, lets say you and your spouse jointly own your family home and there is $20,000 of equity in the home. Well, your spouse’s 50% is worth $10,000. The bankruptcy process requires the trustee to collect that $10,000.

As you can see from the above, these situations require professional advice. If you find yourself in this predicament, call or email us so that we can meet with you to work out a plan.