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Is Filing Joint Bankruptcy Better for Couples?

by | Jul 25, 2018 | Firm News

Filing a Joint Bankruptcy Petition

When married couples get into a debt situation, sometimes just one or the other of the spouses has debts – and sometimes they are both in debt.

A joint bankruptcy, allows spouses to file a single set of bankruptcy papers with the court together in one bankruptcy action.

While both Chapter 7 and Chapter 13 allow your bankruptcy lawyer to file “joint bankruptcy,” a couple is never required to file joint bankruptcy.  It is always your choice to file bankruptcy jointly with your spouse – or separately as an individual.

Advantages to Filing Joint Bankruptcy

Filing a single joint bankruptcy petition together as spouses can save time and money over filing 2 separate bankruptcy cases.

With a single joint bankruptcy you can wipe out the dischargeable debts of both spouses, without needing to file two individual bankruptcies. Whereas, if only one spouse were to file bankruptcy, the non-filing spouse is usually still liable for his or her separate debts AND his or her share of any joint debts.

However, under some circumstances, having just one spouse file bankruptcy may be the better strategy.

Advantages to Filing Separate Bankruptcy

In a joint bankruptcy, you must disclose all property owned by you and your spouse.  And – in any bankruptcy – there is a “limit” on the amount of property you can keep. So Joint Bankruptcy can potentially pose a problem, in situations where the spouses combined assets put you above the “exemptions” that are available in bankruptcy.

Additionally, one spouse may earn substantially more than the other. This added income can then raise re-payment plan payment amounts under a Chapter 13 bankruptcy. Additionally, one spouse may have “good credit” that they wish to protect – and so it may not be best to include them in the bankruptcy.

What’s Better: Separate or Joint Bankruptcy?

A married couple should always discuss their debt situation with an experienced bankruptcy lawyer, before deciding if they should file a Joint Bankruptcy or a Separate Bankruptcy. The laws surrounding issues such as “exemption limits” are very complicated – as are the calculations made in determining repayment plans.

Best Southfield Bankruptcy Attorneys

Our experienced bankruptcy lawyers have helped hundreds of married couples file jointly and separately – depending up what is right for their unique situation. We can help you file for Joint or Separate bankruptcy in any Michigan County, including, Wayne, Macomb & Oakland County.

We have helped hundreds of couples and individuals in Macomb, Oakland and Wayne County. We can help you, too.

Southfield Bankruptcy Attorney Free Consultation: [nap_phone id=”LOCAL-REGULAR-NUMBER-1″]