Is spouse affected by bankruptcy?

[SavemyASSets24]

I'm going to simplify my situation.

(Husband) I am upside down in my house, my income has been cut dramatically. I have a large amount of credit card debt. I am going to lose my house to forclosure eventually. I would like to file for chapter 7, and start all over again.

My wife's name is not on either mortgage, but possibly on the deed. We have no bank accounts together, no credit cards together. She has great credit and I would like to keep it that way.

If I file for bankruptcy is this going to affect her, and in what ways?

I also own two cars debt free, combined value....$17,000 roughly, should I sell one outright, and put one completely in her name only? Or could I put them both in her name and have them protected?

[needafreshstart]

Trying to sell assets or transfer them is fraud.

[SavemyASSets24]

End of story?

Is it that simple, I'm just supposed to maintain things the way they are now and change nothing???

I'm not in foreclosure for probably 90 days, doubt i'm even in preforeclosure. I don't have any immediate need to file bankruptcy, I'm not allowed to do anything even though there are no legal preceedings against me?

[keepmine]

A lot depends on if, you live in a community property state and, if that state allows a lender to file a lawsuit over a deficiency balance on a mortgage.
Also, how much equity does your state allow you to exempt for autos and personal property?
See a couple or 3 bk lawyers and get all of your options expalined. There is nothing wrong with preplanning a bk but, you need to do it the right way. Don't involve friends or family and try and swap assets that would normally not be exempt for assets that are exempt. Ex. If you can't exempt both cars, sell one {not to a fa,mly member} and put the proceeds in an IRA. A lawyer can advise on timelines and things of that nature.

[SavemyASSets24]

ok...

So I'm seriously getting the feeling I should seek paid legal advice and not ask anything else in here...

[SavemyASSets24]

Business shelter?

I don't suppose my business could shelter assets that were paid for with personal funds...

[Dollar Bill]

Depending on where you live there is a chance you could protect some of your assets with exemptions available from your state. If I were in your soes, here in CA I can exempt the two cars with a wildcard exemption. We get up to 22k or so....if there is nothing else you should protect. Is there equity in your home? Do you have any boats etc etc.

Community property laws can sometimes be very complex. I like the fact that you and yur wife have pretty much split things; however, there is a chnace she may not be protected. If you file and she doesn't, creditors may be able to pursue her fr her part of the comm property. A few BK atty's will explain all of that best.

I hope your situation gets better. This is a great place full of resources. We are all happy to help.

It would be easier to explain in more detail what your situation is. How much debt? How upside down if at all are you in your home? How many assets? What state? We can all pitch in and give you a better idea of what you may want to do. There are also many folks on the forum that may live in your state, city, or even next door to you. They will be abale to further help and explain what their experience was.

[SavemyASSets24]

Home equity, none $50-$100,000 deficit due to florida's depressed market, I own a unique rural property that will not receive much appreciation at the moment. Was valued at nearly $400,000 but at auction may go for as little as $275,000???

No boats, got a loaner from my dad will send it back to his house.
Florida here, I think 1 car exemption with a $1k value.
Credit Card debt....maybe $20k

Assets that could be sold quickly...maybe $20k

I would love to even liquidate this stuff and

1. create some kind of exempt investment
Roth IRA
anything better than just losing it all

2. Paying off any and all of wife's credit

Worried about creating ties between my debt and her debt/credit though.

Even if I could put money in some kind of scholarship fund for me and my family that would be great. I just know that I don't want to end up in the pokie, never been, hopefully never will.

[AngelinaCatHub]

OK, I’m going to give you some really bad advice. It was suggested by one of my lawyers and we did attempt it and wasted the filing fees. However I will tell you of it anyway: Bankruptcy can cause marital stress. Maybe your wife should divorce you. Yes think on this. Could this also cause further bk problems, so her clean assets are out of your life. Upon your “reconciliation” after the bk and you are on a mental even keel, remarry.

It is a bit of a hurtful thing I know, and probably not legal, but you seem to be more concerned about her being liable that it may be to her (and your) advantage to file as an unmarried person. Crazy as it sounds, it was once sold to me within one of my adversary’s many harassment law suits. Pray a lot too.

[SavemyASSets24]

Divorce

It crossed my mind, but no I don't think thats what we'll do. My luck there wouldn't be a reconciliation, lol.

Its not so much that I don't want her to get hurt, its that I see her as my.... hopefully unscathed and good credit other half, a second chance if you would.

[AngelinaCatHub]

Well, no offense of course. I understand. I was "under handedly" complimenting you on your concern for her. Probably, most of us men would be in the same situation as the spouse walks away to a really new life.

At least, unlike most divorces, she could not take you to the cleaners. Please accept my appology for suggesting this.

[Dollar Bill]

You know...I heard the divorce thing worked a very long time ago. New laws have changed the way your assets can be seized.

My #1 concern for a long while was trying to make sure my wife did not have to file. Comm. Prop laws will not allow it. I wanted her as a back up. Atleast one of us will have good credit. She did not process any of the debt, but is still liable.

It sounds like you have too many assets for 20k of debt. Sounds like selling some of the assets would definitely help payoff that amount. $275k in rural prop? That's a lot. Is it owned out right did you say?

You may need to jump onto the C13 poster if you would like to keep all of these assets, and lower your monthly payments.

[SavemyASSets24]

to many assets

my wife and I together have about $35k in cc, but it is seperate from each others name. I do have assets, but they are crap compared to....$100,000 in combined debt.

Basically I know I'm going to lose my tree, but I'd like to keep some of my nuts...

even if it has to be a retirement fund or something else is better than nothing

[CANTDOIT]

DollarBill do you get that wild card exemption only if you own a house.. what if your a renter?? (where can i find info on that wildcard?)

[Dollar Bill]

No....here in CA you choose which would serve you better. 22k wildcard or 75k of house equity.
If you are a renter then you will use the wildcard.