Filing for Bankruptcy as a Married Couple: Joint or Individual?
When financial stress begins to weigh on a marriage, bankruptcy may feel like the only option to start fresh. However, deciding whether to file jointly or individually is a critical decision that will shape your financial future. This blog breaks down the key elements of each filing option to help you and your spouse make an informed choice.
Joint Bankruptcy Filing
Filing for bankruptcy together can simplify the process for married couples. Here's what you need to know:
Advantages
- Consolidates debts, requiring only one filing fee.
- Covers all shared debts, offering a clean slate for both partners.
- Simplifies the legal process by combining financial information into one case.
Disadvantages
- Both partners' credit scores will be impacted.
- Joint filing exposes all assets, even those individually owned, to scrutiny.
Individual Bankruptcy Filing
Individual bankruptcy allows one spouse to tackle debt while possibly protecting the other's credit. Here's a snapshot:
Advantages
- Protects the non-filing spouse's credit score if debts are not shared.
- May preserve assets owned solely by the non-filing spouse.
- Ideal for marriages where one spouse has significantly more debt.
Disadvantages
- Some joint debts may still hold the non-filing spouse responsible.
- Separate filings are not cost-efficient and may complicate the process.
Key Differences Between Joint and Individual Bankruptcy
- Cost: Filing jointly is generally less expensive due to combined legal fees and shared submissions.
- Debt Ownership: Joint filings address all shared debts simultaneously, while individual filings isolate responsibilities.
- Asset Protection: Individual filings may better shield a non-filing spouse's assets.
Factors to Consider Before Filing
Your unique circumstances will influence whether a joint or individual filing is best. Key questions to ask include:
- How are debts distributed between you and your spouse?
- Do you jointly own significant assets, such as property?
- What are your combined and individual incomes?
- Does your state follow community property or common law for financial liability?
Consult Bankruptcy Attorneys in Springfield, MO
Bankruptcy is a challenging decision, but it doesn't have to be made alone. Consulting a qualified bankruptcy attorney will ensure you understand your options and choose the best path forward.
At Licata Bankruptcy Firm, we provide compassionate, expert guidance to help you achieve financial relief. Contact us today at (417) 213-5006 to schedule a consultation and take the first step toward a new beginning.
