Can Husband File CH 13 and Wife File Ch 7???

[MarieT]

Okay...I feel this is the dumbest of questions but my husband is telling me that I should file CH 7 and he should file Ch 13. I have never heard of a married couple filing two different kinds of BK??? I told him that would be nuts because the house payment is huge but the mortgage is only in my name even though he is the one (now) with the good job so his income is actually paying the house payments now. I no longer have my $200K job that I had when I bought the house. He has the two cars in his name.

I am finally having the the case preparation meeting with the attorney this week to figure out whether we are doing Ch 13 or whether to try to go the settlement route. My husband has started making more money as some things have changed around at his work so we will probably be at a 100% payback if we do Ch 13. I think we should try to settle with the collection companies as we are insolvent (owe way more than our assets) but I will talk to the attorney about that. We probably owe about $100K more than the value of the house and another $75K in credit card debt and we sure don't have $175,000 of assets to offset that debt!

[shark66]

AFAIK, that's not possible...

Do bear in mind, regardless of who files and who doesn't both incomes are counted...

Now you have one spouse saying "I'm broke and need a discharge of all of my debts right now" while the other in their filing says "Yes, I've got enough money to fund a Ch. 13 repayment plan"...

Not going to fly...unless there's a legal separation involved.

Good luck.

[BKParalegal]

AFAIK, that's not possible...

Do bear in mind, regardless of who files and who doesn't both incomes are counted...

Now you have one spouse saying "I'm broke and need a discharge of all of my debts right now" while the other in their filing says "Yes, I've got enough money to fund a Ch. 13 repayment plan"...

Not going to fly...unless there's a legal separation involved.

Good luck.

Actually it is possible, when one spouse files bankruptcy the non-filing spouse can retain expenses that are not typically allowed in bankruptcy. Case law states the non filing spouse does not have to give up their lifestyle due to the bankruptcy. So the bankruptcy only has to include the marital contribution which is his income less his personal expenses and if he is spending $1000 a month on strippers than he can still spend that money and deduct it from his contribution to the household.

More importantly, it does not make sense for one to file a 7 and then the other file a 13. So my answer is meaningless and you should disregard it, except for the fact that it is correct.

Good luck

[MarieT]

I tried to explain to him that all our income is together so it does not make sense. If he didn't have the house payment to offset his income, he would be paying a huge amount on a Ch 13 repayment plan. Thanks...I guess I will wait and have the attorney try to explain it to him.

[shark66]

Actually it is possible, when one spouse files bankruptcy the non-filing spouse can retain expenses that are not typically allowed in bankruptcy. Case law states the non filing spouse does not have to give up their lifestyle due to the bankruptcy.

That's perfectly fine and true if indeed only one spouse files. But if both of them were to do it (separate 7 + 13) this argument is dead in the water.

So the bankruptcy only has to include the marital contribution which is his income less his personal expenses and if he is spending $1000 a month on strippers than he can still spend that money and deduct it from his contribution to the household.

What I wrote above...


More importantly, it does not make sense for one to file a 7 and then the other file a 13.

I'd tend to say that it actually might make sense in certain cases, but still have yet to see a court that would allow it...

So my answer is meaningless and you should disregard it, except for the fact that it is correct.

Good luck

Good luck to us all...

[momofthree]

I could see how it could make sense: If the hubby is going to be in a high percentage payback plan, and the wife has a lot of unsecured debt of her own, then her filing a ch.7 on her debt and receiving her discharge before the hubby files the 13 would thus decrease the amount that the hubby has to pay back. Sure, he may end up paying his debt back at 100%, but better to pay 100% of, say $30k, than pay 50% of $100k, kwim? (random numbers used as I obviously don't know the situation).

[lrprn]

@Marie, you mentioned that you are considering debt settlement. Given the amount of debt you have, the chances this will work are slim to none. Do a few searches here in the forum - there are *many* sad stories here of members who paid thousands of dollars trying debt settlement only to fail and end up filing bankruptcy anyway.

I strongly recommend setting up free initial consultations with at least 3-4 experienced bk lawyers in your area and discuss *all* of the possibilities in your situation. You want a good long-term financial solution that gets you out of the financial hole in five years or less.

Talking through each of the options with multiple bk lawyers will help you understand if filing separate bankruptcies (same chapter or not), filing one bankruptcy as a married couple, or attempting debt settlement makes the most sense in your situation or not.

[shark66]

I could see how it could make sense: If the hubby is going to be in a high percentage payback plan, and the wife has a lot of unsecured debt of her own, then her filing a ch.7 on her debt and receiving her discharge before the hubby files the 13 would thus decrease the amount that the hubby has to pay back. Sure, he may end up paying his debt back at 100%, but better to pay 100% of, say $30k, than pay 50% of $100k, kwim? (random numbers used as I obviously don't know the situation).

Absolutely. But it can't be done simultaneously.

Good luck to us all.

[IamOld]

Right not at the SAME time, but I may be doing this - that's what my atty wants to do...BUT not at the same time - one of us goes first and the other goes second...

[MarieT]

Thanks everyone for your answers but we already filed together.