How will mortgage appear on non-filing spouse's credit record?

[BKAustin]

I am close to pulling the trigger on Chapter 7, filing singly. However, my spouse's (understandable) concern is that it will mess up her credit and, as she works in IT security, it could prevent her from getting a job.

Most of our credit card debt is in my name. The only debt with both our signatures is our mortgage. We have never been late on it and intend to keep the house and keep paying the mortgage. Texas has a strong homestead exemption and so we should be able to keep the house. My attorney advises to not reaffirm the mortgage as part of BK.

I have read posts on the internet that say that when one spouse files for Chapter 7 and does not reaffirm the mortgage, the mortgage on the credit record (both spouses' records) shows no sign of having filed for bankruptcy, except that the bank may stop updating it as paid (and may stop sending statements). Can anyone who has been through a similar situation corroborate this?

How does the mortgage show up on your credit record after BK, both with and without reaffirming?

[MrsDixon]

Regardless of reaffirmation the mortgage on your wifes CR should be the true status of the loan "paid as agreed", etc.

If you reaffirm the loan then the mortgage company may report your payments. If you don't reaffirm the account should say $0 balance and included in bankruptcy and there will be no more reporting on your credit report.

[BKAustin]

Regardless of reaffirmation the mortgage on your wifes CR should be the true status of the loan "paid as agreed", etc.

If you reaffirm the loan then the mortgage company may report your payments. If you don't reaffirm the account should say $0 balance and included in bankruptcy and there will be no more reporting on your credit report.

Thank you for the quick answer, Mrs. Dixon! Just checking, do you know this from personal experience or second-hand (the unchanged, normal entry on the spouse's credit record)?

[MrsDixon]

I know this w/ experience on a regular account. I had a joint CC w/my DH. When I filed my account said $0/ IIB and the account on his report was still paid as agreed.

Whether the debt is secured or unsecured is irrelevant.

They can't report anything about a BK if she didn't file herself. Maybe the account won't say "joint" anymore but it shouldn't say anything about a BK.

If for some reason it gets updated with BK remarks all she has to do is dispute as "paid as agreed/never late/never filed BK" and the creditor will update it.

[keepmine]

I know this w/ experience on a regular account. I had a joint CC w/my DH. When I filed my account said $0/ IIB and the account on his report was still paid as agreed.

Whether the debt is secured or unsecured is irrelevant.

They can't report anything about a BK if she didn't file herself. Maybe the account won't say "joint" anymore but it shouldn't say anything about a BK.

If for some reason it gets updated with BK remarks all she has to do is dispute as "paid as agreed/never late/never filed BK" and the creditor will update it.

This is correct. In 04, the 3 CRA's settled a classaction lawsuit on this issue. I'm a bit pushed for time at the monemt but, I'll try and find a link to the case.

[Brazzy]

Bankruptcy will not be reported, but any delinquency in the account will be.

[keepmine]

Here's the case that started it all.

http://www.law.com/regionals/ca/opinions/mar/0015946.shtml

and here's the first part of the classaction.
Just trust me-the CRA's settled. It's just a hell of a long and boring read before you get to the finish line. You can search the myfaircredit site if you like. I believe there are 4 different links dealing with the case as it meanders through the legal system.

http://www.myfaircredit.com/forum/viewtopic.php?t=752&sid=af474261c8d99eb74acd6774803d7a6f

[BKAustin]

Here's the case that started it all.

http://www.law.com/regionals/ca/opinions/mar/0015946.shtml

and here's the first part of the classaction.
Just trust me-the CRA's settled. It's just a hell of a long and boring read before you get to the finish line. You can search the myfaircredit site if you like. I believe there are 4 different links dealing with the case as it meanders through the legal system.

http://www.myfaircredit.com/forum/vi...cd6774803d7a6f

Thanks Keepmine and others for taking the time to reply to my question. I'd encourage others with similar experiences to chime in.

I will update on how my case goes as well.