Do We Have to File Chapter 13 Jointly?
Married couples are not required to file bankruptcy together. Individual circumstances will indicate whether it is in your best interest for you and your wife or husband to file bankruptcy jointly or whether just one of you should file.
Sometimes It Is Best for Only One Spouse to File Bankruptcy
There are often good reasons for one spouse to stay out of bankruptcy such as when that person has received or is expecting a large inheritance. Perhaps you or your spouse shares ownership of a family cabin with siblings. Filing bankruptcy could put both the property and family relationships at risk. Perhaps one of you is a partner in a small business, and you wish to leave the business completely out of the bankruptcy.
It may be best for that spouse not to file in a situation such as one of these scenarios. The two of you can choose to collaborate on paying off any debts of the non-filing spouse once the bankruptcy is complete.
When the Non-Filing Spouse is a Co-Signer on a Loan in the Bankruptcy
What if the spouse who is not going to file bankruptcy is a co-signer on debts held by the filing spouse? In this circumstance, Chapter 13 bankruptcy may be the best option. Chapter 13 bankruptcy protects a co-signer such as a non-filing spouse from collection efforts during the three- to five-year period of debt repayment.
Therefore, for many couples, a better question is, “How can we maximize the benefits of bankruptcy when one of us chooses not to file?” A frank discussion with an experienced and knowledgeable bankruptcy attorney is an excellent way to determine the answer to this question.
We would like you to know that only three lawyers in Chicago are certified in consumer bankruptcy by the American Board of Certification*, and two of those are partners at Ledford, Wu & Borges, LLC. We are prepared to advise and guide you through Chapter 13 or Chapter 7 bankruptcy, with or without your spouse.