wiife not filing

[racefan92]

I have been considering filing ch7 bk myself and I was wondering if this would hurt my wife's credit. She is on the mortgage,truck and car loans that I will reaffirm on but not anything else that I will file on. I was also curious about my truck which I only owe 6500 but it is worth 10500, in illinois the exemptions are only 1200. Will they make me sell it. We need both vehicles.

[2Bshinyandnew]

I have been considering filing ch7 bk myself and I was wondering if this would hurt my wife's credit. She is on the mortgage,truck and car loans that I will reaffirm on but not anything else that I will file on. I was also curious about my truck which I only owe 6500 but it is worth 10500, in illinois the exemptions are only 1200. Will they make me sell it. We need both vehicles.

Technically if you are reaffirming all your joint debt, your wife's credit should not be affected, BUT, I would keep a super close eye on her credit report and make sure nothing gets on that shouldn't be, and be ready to challenge anything negative that pops up. It will be time consuming, just be organized about it.

The auto you have equity in...in general if you have equity in an auto your choices are to:

1) Surrender it to the trustee and walk away (which may not be a choice for you since your wife is on the loan)
2) Come up with the difference to pay the trustee, perhaps from an exempt retirement account or a gift from family
3) work out a payment arrangement with the trustee
4) Before filing, trade it in for a slightly more expensive car, eliminate the equity.
5) Lend it to my 18 year old daughter for a month and she will make sure you have at least $4000 in body damage (totally joking on #5, sort of)

If you have not filed yet, it is perfectly acceptable to trade the vehicle with equity in and get something newer. It may be wise to do since your pre-filing credit score may (not always) allow you to get a better interest rate.Then you won't have to worry about having an asset to deal with during your BK. The interest rate and payment may be higher, so you need to crunch the numbers and see which scenario will yield you the least out of your pocket in the long run.

[pcn]

What about taking out a personal loan with the truck as collateral? That way you could use up most of the equity.