Will My Spouse Be Affected When I File for Bankruptcy?

California is a community property state, which means that it treats all assets and liabilities acquired during the course of a marriage as jointly owned. Of course, if you find yourself facing unmanageable levels of debt and need to file for personal or business bankruptcy, you may be wondering how your decisions will affect your spouse.

You may file for personal bankruptcy either on your own or together with your spouse. If you file for chapter 7 bankruptcy individually, your eligible debts will be discharged, or eliminated, including all eligible community property debts owed by you and your spouse. Of course, this also means that your jointly held assets may be vulnerable to liquidation to pay your creditors.

Debts and assets acquired before marriage may be handled differently. Debts from a marriage that ended in death or divorce will also be handled differently, particularly in a divorce when those debts have been assigned to a particular spouse.

Filing jointly may allow you and your spouse to double your bankruptcy exemptions. This can allow you to protect more of your jointly held property as you eliminate both communally held debts as well as debts both partners obtained separately before marriage.

Not all bankruptcy decisions are right for every person or couple or every situation, which is why it is so crucial that you discuss your decision with our experienced Los Angeles bankruptcy attorney.

If you are considering filing for Chapter 7 or chapter 13 bankruptcy, you owe it to yourself and your spouse to contact our bankruptcy lawyer in California to schedule a consultation to determine which filing may be right for you and your marriage. You can learn how best to protect your as you begin your journey down the road to a financial fresh start.

Source: Bankruptcy Attorney Los Angeles

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