Getting Married? If You’re Drowning in Debt, You May Want to File Bankruptcy Before You Tie the Knot
If you’re getting married, you’re probably looking forward to starting a new life with your soon-to-be spouse. But if you have a lot of debt, keep in mind that you’ll also be bringing some not-so-great aspects of your old life into your marriage.
If your financial situation warrants filing for bankruptcy, it’s advisable to do so before you say, “I do,” according to bankruptcy experts – especially if your future spouse has little to no debt and a good credit record.
Prior to bankruptcy reform in 2005, it was possible for one partner in a marriage to file for bankruptcy, regardless of the other spouse’s financial situation. These days, however, bankruptcy law isn’t so lenient.
If you qualify to file for Chapter 7 bankruptcy but your partner earns too much money to be considered eligible, you won’t be able to file – even though the debt belongs to you. Bankruptcy courts use household budgets rather than individual budgets to determine eligibility; essentially, they believe it’s up to the higher-earning spouse to cover the other spouse’s debts.
By waiting until after marriage to file for bankruptcy, you’d be not only limiting your ability to find debt relief, but you’d also be jeopardizing your spouse’s finances. And that’s bad for both of you should you want to buy a car or a house together later down the road.
On the other hand, filing for bankruptcy before you get married protects your spouse’s credit and sets you up to build credit during your first years as a married couple. Building credit together is an important step in any marriage, but it’s especially significant when you’ve recently eliminated debt through bankruptcy.
The sooner you file for bankruptcy before your wedding, the more time you’ll have to get credit back on track.
Now, there are exceptions to the rule. If both you and your future spouse have substantial debt loads, filing for bankruptcy jointly can save money because you’ll share filing and legal fees. Your bankruptcy attorney can help you determine whether it would be best for you to file individually or together.
Marriage is an exciting step – but it’s important to start out on the right foot. Eliminating debt prior to your marriage lessens the negative impact on your future spouse – and paves the way for you to begin a stronger, happier financial future together.
To learn more about bankruptcy and what it may be able to do for your unique debt situation, contact DebtStoppers today to schedule a complimentary one-on-one debt analysis with a knowledgeable bankruptcy attorney.
Will My Bankruptcy Affect My Fiancé If We Marry? By J.E. Cornett, eHow Contributor