Married Couples and Bankruptcy
While married couples have the option to file jointly, either spouse has a right to file separately. Filing separately usually makes sense if you and your spouse have separate accounts with creditors before making the decision to file. There are a few issues to keep in mind that could affect your spouse if a bankruptcy filing is completed.
Filing for bankruptcy may not protect your spouse from being contacted by creditors. Chapter 7 bankruptcy has what is called the automatic stay that protects a consumer from being contacted about outstanding debt during the filing process but creditors may attempt to collect from the non-filing spouse. However, Chapter 13 bankruptcy may offer protection under the co-debtor stay while the filing is pending.
If you and your spouse share debt it may make sense to file bankruptcy jointly. Joint debts often include credit card accounts but other joint debts can be considered. Joint filing may help you save money since it is considered one filing. If a spouse is looking to file on their own, they should review personal outstanding debt along with debt incurred as a couple and review eligibility for filing.
A separate filing may be considered for different reasons. A couple may consider filing separately if there is conflict between the two parties. If separation or divorce is imminent, it may be an option to help resolve martial debt. Bankruptcy filing may have a different effect depending on what state you live in. If you file in a community property state, it's possible for bankruptcy laws to protect the non-filing spouse but you should review your situation with a licensed bankruptcy attorney.