Married people can get confused about how to utilize Chapter 7 or Chapter 13 bankruptcy protection. Some couples with excessive debt — whether it is related to an illness, a job loss, a business issue or another problem — know bankruptcy can help bring relief, but they may be unclear about whether they should file together or separately, which can be more expensive and complicated.
These couples may be even less clear about the possible advantages of filing for bankruptcy at different times. This can be referred to as a “staggered filing.” In some cases, there is much to be gained from timing their separate bankruptcies in a strategic manner.
Do my spouse and I both need to file bankruptcy?
Every situation is different. Every bankruptcy filing should be used in a way that maximizes debt relief and asset protection. Depending on your circumstances, it may be important for you and your spouse to both file bankruptcy; if only one of you files, your spouse may not have protection against some creditors.
What advantage can we gain from doing our bankruptcies at different times?
Bankruptcy petitions are made in federal court. A bankruptcy filing can be individual or joint. Think of individual filings as separate court cases and a joint filing as a single case. In some circumstances, staggering separate filings can provide more asset protection and bring a deeper sense of financial relief. People who file separately may feel like they are gaining multiple layers of protection and exemption of assets.
Since everyone has a unique set of debts, it is important to talk to a knowledgeable bankruptcy attorney about how to solve your financial problems. If bankruptcy is right for you and your spouse, an attorney can help you design a plan that will help you take maximum advantage of the federal bankruptcy code.
If you’re in financial trouble, talk to a professional
Many people who are in serious financial trouble feel a great deal of stress, which can affect their family life, their careers and their physical and mental health. Knowledgeable bankruptcy lawyers understand the complex emotional and relational aspects of debt.
If you and your spouse are considering bankruptcy as a debt relief solution, get experienced legal advice rather than relying on hearsay, feedback from well-meaning friends, social media posts and news articles. Reliable help is available, often with a free initial consultation.
