My son recently got married to a wonderful girl. They will be taking this vow, and that vow: to have and to hold, in sickness and in health, to death do they part, etc. and etc. But most importantly, they are taking a vow to be together. Last time I checked, I don’t recall anything in the vows about having to file for bankruptcy together. And even if they are married by a bankruptcy judge, the judge isn’t going to require it either.
Why a Spouse Files for Bankruptcy
In fact, there may be some very good reasons why only one spouse needs to file. Three common situations come to mind.
The first situation is when one spouse brings debt from a prior marriage. Another is when one spouse, never married, brings in a large amount of debt such as a student loan. A third is when, for whatever reason, one of the married spouses uses his or her credit for the benefit of the family or just for his or her own needs but doesn’t coordinate this with their spouse who always seems to pay his or her debts on time.
In every one of these cases, and others as well, it may make more sense for only one spouse to file. If only one spouse files, the other spouse may continue to have good credit that can be used in emergencies. Another reason is that if one spouse has no debt to speak of or only minor debt, there may be nothing to gain by his or her participation in a bankruptcy. And yet, another reason might be to preserve family harmony.
I may not make the same recommendation if the spouse who does not wish to file has a lot of debt. For example, I had one spouse come in with $35,000 in credit card debt and she wanted to file on her own. Her husband had $30,000 of his own debt. He didn’t want to participate. I showed the husband that, even if she filed for bankruptcy, they would have no way of paying his debt either. He was worried about his credit, and I told him that in almost all cases, our clients have some credit within a year of filing, decent credit within two years, and good credit within three years.
After we calculated how much money he was spending on his bills (almost $900.00 per month) and how much he could save by filing for bankruptcy, he was convinced. They were so thankful, and are doing well now.
How it Affects the Spouse
If the reluctant spouse has little or no debt, there is rarely a reason to file. When that spouse does not file, they are also not brought into the bankruptcy case if they have no joint debt.
Keep in mind, however, that the court does need to see all of the household income and household expenses, so while the spouse is not brought into the case, their income is still a factor among many others when determining bankruptcy relief.
So congratulations to my son and his wonderful wife. May their life be full of joy and happiness and kids. And if it would ever come time that one of them would to need to file for bankruptcy, I want them to know that they would not be breaking any vows if they don’t do it together.