by Angela Marquis, client service specialist
One of the more stressful situations in life a person can go through is a separation or a divorce. If it is compounded by financial difficulties, which is often the case, it can seem overwhelming.
Recently, I had just this situation and the question arose “my spouse declared bankruptcy after we separated. What impact does that have on me?”
If one spouse files and the other doesn’t, it does not always mean the other spouse will be forced to file for bankruptcy too. If all the debts are just one one spouse’s name, then only the spouse with the debts will file. However, if you have joint debt, or you are the co-signor with your ex-spouse on a debt, or have a secondary credit card, the creditor can require the entire payment of that debt from you even though the separation agreement says the full debt belongs to your ex-spouse. Unfortunately the creditor didn’t agree to this, so they aren’t bound by it.
Keep in mind that if both spouses own property together, such as a house with a mortgage, then that would be a debt of both parties.
Many people believe that filing for bankruptcy means you don’t have the obligation of paying child support or alimony. This is not true as these are non-dischargeable in bankruptcy. Meaning it does not release your spouse from the obligation of continuing to pay alimony or child support to you.
As you can read, this is a very confusing situation. You can sit down with us and we can review your situation and try to help you understand what debts you are responsible for .
If you’re concerned about how the bankruptcy would affect you or are considering filing for bankruptcy either separate or filing jointly with your spouse, call us at 519-250-8060 or 310-PLAN to set up an appointment to find out which situation will be best for you.
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