My Story: More confused now than ever

[brokeinAZ]

[lrprn]

The bk lawyer you spoke to is correct. When both names are listed as owners on non-secured credit, it does no good for only one spouse to file bankruptcy - the lenders move on to the other co-owner and expect them to pay instead.

Since you have so much shared debt, it may be your only option to file jointly to get your fresh start as a couple.

Here's the rub - how much equity do you have in your primary home? Arizona allows $150,000 for both you - http://www.dianedrain.com/Bankruptcy...exemptions.htm

Do you have other secured assets (cars, for example) that you want to keep if you file Ch 7? And are you current on the payments for those assets currently?

[millerc507]

Just a thought, are you sure the debt is joint or is she just listed as an authorized user? It will indicate an A somewhere beside it for authorized user. If so, all she needs to do is call and tell them she wants to be removed as an authorized user. My husband had to do this. Some gave him a problem but most were helpful.

[phoenyx]

Just a thought, are you sure the debt is joint or is she just listed as an authorized user? It will indicate an A somewhere beside it for authorized user. If so, all she needs to do is call and tell them she wants to be removed as an authorized user. My husband had to do this. Some gave him a problem but most were helpful.

Agreed.

I just went through this with my wife. I am filing Chapter 7 personally, and she isn't filing with me. She had a credit card on her credit report that was mine, when she was classified as an authorized user.

I would recommend checking into if she signed the initial credit application with you, or if she signed something later to add onto the account. I don't know the specifics of the laws exactly, but in many cases if she was added over the phone, she might be more classified as an authorized user rather than joint account holder.

The other thing you have to think through is whether the balance on anything she does owe is worth paying (possibly borrowing from relatives/friends, which is a can of worms) to preserve her credit. Without knowing your joint balances, I can't comment on this specifically. And, even so, it's a judgment call, so it would be worth discussing with your bankruptcy attorney. If it's a decent sized balance, very possibly it might be better to include her on the bankruptcy and have the debt discharged rather than pay it. Bankruptcies aren't as bad as many people think for their futures.

[brokeinAZ]

The bk lawyer you spoke to is correct. When both names are listed as owners on non-secured credit, it does no good for only one spouse to file bankruptcy - the lenders move on to the other co-owner and expect them to pay instead.

Since you have so much shared debt, it may be your only option to file jointly to get your fresh start as a couple.

Here's the rub - how much equity do you have in your primary home? Arizona allows $150,000 for both you - http://www.dianedrain.com/Bankruptcy...exemptions.htm

Do you have other secured assets (cars, for example) that you want to keep if you file Ch 7? And are you current on the payments for those assets currently?

We are upside down on our current home due to the market. We are making monthly payments on both cars. Both were financied in 07. We are current on everything except the 2nd home

[brokeinAZ]

Agreed.

I just went through this with my wife. I am filing Chapter 7 personally, and she isn't filing with me. She had a credit card on her credit report that was mine, when she was classified as an authorized user.

I would recommend checking into if she signed the initial credit application with you, or if she signed something later to add onto the account. I don't know the specifics of the laws exactly, but in many cases if she was added over the phone, she might be more classified as an authorized user rather than joint account holder.

The other thing you have to think through is whether the balance on anything she does owe is worth paying (possibly borrowing from relatives/friends, which is a can of worms) to preserve her credit. Without knowing your joint balances, I can't comment on this specifically. And, even so, it's a judgment call, so it would be worth discussing with your bankruptcy attorney. If it's a decent sized balance, very possibly it might be better to include her on the bankruptcy and have the debt discharged rather than pay it. Bankruptcies aren't as bad as many people think for their futures.

Thank you for the info. I will check that out. I think she is just an Auth user becasue i had the CC before we even met.
Our total CC debt is 27k. Tehn for the 2nd home we owe 141k on the 1st and 33k on the 2nd plus the 4 months of HOA which = 1400.00
I think with adding everything we total over 200k?

[brokeinAZ]

I am looking at our credit report. There are some accounts under ECOA that show B and some that show C and some that show J
I ran our credit through my mortgage software "Point" and used my informative reseach credit pulling account.
B=borrower
C= co-borrower
J= Joint ?

[brokeinAZ]

OH MY GOSH
You guys are the best. I called our credit card companys and we have our own accounts. The cards with the ballance's are in my name with my wife as an Auth user. That is such great news... Thank you all

[millerc507]

I am so happy it will work out for you. Be sure to have her name removed as authorize user, JIC, because the credit card companies are notorious for trying to go over authorized users--legally they can't but that doesn't stop them from trying.

[Dollar Bill]

Is a AZ a community prop. state?

[brokeinAZ]

Is a AZ a community prop. state?

Yes. but would that matter in a BK sitituation?

[phoenyx]

Is a AZ a community prop. state?

Yes, Arizona is a community property state. brokeinAZ, if you are in Arizona as your name suggests, or any other community property state, you need to talk to your bankruptcy attorney again about this issue -- ASAP.

He is going to be more familiar with how your state's community property laws affect you. The debts may be considered owed by her as well, since the two of you are married. However, especially if the accounts are old and were opened by you individually before you married, you might have a chance at getting around it -- but you would have to talk to your attorney, I don't know the specifics.

Whether she is liable and whether you can get the accounts off her credit report MAY be two separate issues. They may be one and the same, I'm not sure. What I'm saying is that even if your attorney says your state makes her liable for all your debts as well, you might have a shot at still having them removed from her credit report. I don't have enough experience with this to make a guess at your chance of success.

[phoenyx]

Yes. but would that matter in a BK sitituation?

It will have some effects.

I know that this causes any property she owns with you, or even by herself, to be fully attributable to your bankruptcy estate. That is, if she has assets that she owns entirely without you, they can be seized in a bankruptcy by a trustee if they are not able to be exempted.

As for whether she owes the debt, I am hesitant to say. I just don't have any personal experience with this issue. Your attorney will know in much more detail.

[brokeinAZ]

crap now i feel back to square one

[phoenyx]

crap now i feel back to square one

Don't feel down unless your attorney says you are back to square one. I am not certain if being in a community property state has the effect of saying one spouse is liable for the other's debts, or just that the trustee would have access to the non filing spouse's assets. I'm not certain that she's liable for your debts if she didn't sign onto them. ... She may be, I'm just not sure.