If you’re married and struggling with debt, deciding whether to file for bankruptcy alone or jointly with your spouse is a big decision. You might be concerned about protecting shared assets or how filing will affect your credit scores.
The answer depends on your financial situation, and making the right call could help you make the most of the bankruptcy process.
Key factors to consider
Jointly filing for bankruptcy may be ideal if you share most debts, since they can be discharged in one go. This can simplify the process and avoid burdening one spouse with shared obligations. Remember, creditors can still pursue your spouse for joint obligations if you file for bankruptcy alone.
Additionally, filing as a couple can help protect shared assets by maximizing exemptions (the property you’re allowed to keep). In many cases, you’re allowed to double these exemptions if you file jointly. For instance, if you own a home together, a joint filing might better protect your equity than filing separately.
On the other hand, filing alone may be better if most of the debt is in your name only or if your spouse has valuable separate assets that could be affected. You might also want to go solo if you want to protect your spouse’s credit score and ability to borrow in the future.
Seek informed guidance
Every case is different. The structure of your assets and debts, your income and even your long-term goals should all play into the decision. It also helps to factor in the emotional side of things, given that bankruptcy can strain a marriage.
Reaching out for qualified assistance can help you decide whether a joint or individual filing makes more sense for your situation and how to protect what matters most.