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What Happens When a Spouse
Files for Bankruptcy?
Financial hardships, such as filing for bankruptcy,
can
imperil even the most loving and compassionate marriages.
If one's spouse files for bankruptcy, the other spouse may
or may not wish to file simultaneously for bankruptcy.
A bankruptcy filing by one spouse does not bring
the other spouse into bankruptcy. Neither does the bankruptcy
of a spouse give the non filing spouse the full protection of
the automatic stay or the bankruptcy discharge. For example, if
a joint property is owned between them, their estate may be not
be immune to actions on the part of creditors.
What happens if only one spouse
files for Chapter 7 Bankruptcy?
If only one spouse files for bankruptcy, the Court will contemplate
household income in order to determine if the filing spouse is
eligible to file for Chapter 7 bankruptcy. In cases where a filing
spouse has most of his or her debt in his or her name alone, joint
filing may not be so wise. Similarly, if the non-indebted spouse
has numerous non-exempt assets, joint filing may not be recommended.
That is why is so important to work with your bankruptcy
Attorney and financial advisor to work out your best course for
action.
What happens if only one spouse
files for Chapter 13 Bankruptcy?
There are a lot of situations where either the husband or wife
has incurred a great deal of debt and the debt is in only one
of their names and only one of them is obligated to pay the debt.
A spouse is permitted to file an individual case when one spouse
needs to file bankruptcy and the other spouse doesn't.
While the non-filing spouse will not be affected
by the Chapter 13 plan, it doesn't mean that he or she will not
be involved. His or her income and expense data will be considered
when determining the repayment schedule.
If you need additional information regarding bankruptcy
and single filing by one spouse only, take the time to contact
one of the knowledgeable Attorneys at Carrillo and Carrillo, P.A.
to set up a free consultation to discuss your legal options.
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