Should I file bankruptcy? If I do, should I file with my spouse or alone?

I received a call from a woman who was anxious and overwhelmed by debt. She said I had helped two of her friends, but she never thought she would need my help. She felt bad and embarrassed about her situation until we talked.

She said she and her spouse have been struggling with debt for a quite while, but they were paying it off slowly. They felt they had a path that would eventually lead them out of debt. But, because of COVID19, they both were furloughed from their jobs. She has lost all hope. The progress they were making on paying off their debt has been lost. They can't deal with it anymore. She said the stimulus money paid their mortgage and for groceries, but that's it. It's gone.

Does this sound familiar?

If your circumstances are similar, you're not alone. More than ever, people are struggling with debt and are not sure how to handle it. There is so much uncertainty in our lives now. Even if she gets her job back soon, will the caller be facing the same thing if another Corona Virus outbreak occurs in the fall or winter? Bankruptcy was the right answer for her and may be the right answer for you.

This caller asked if she should file bankruptcy alone or should she file together with her spouse.

My answer? Here's what to consider:

1. Are the majority of the debts that you can't pay, or that you are behind on, in your name only? If so, your spouse is probably not responsible for that debt. Other than the relentless stress created by debt, your missed payments probably have no impact on your spouse.

2. In cases where a spouse has good credit and the debt is in the other spouse's name only, it probably doesn't make sense to file bankruptcy together. Only the spouse with the debt should file, in most cases.

3. However, if you have joint or shared debt, it makes sense to file together. You pay one filing fee, you are both protected during the bankruptcy, and if you list all your debt in the bankruptcy, you walk away with fewer debts or no debt at all when you receive your discharge and the bankruptcy is over. Whether or not all of the debt is discharged depends on the facts of your case, what chapter bankruptcy is filed (Chapter 7 or 13) , whether there is IRS debt, student loan debt, and other factors that we can discuss with you when you call us at (321) 690-2363 or email us at advocates@cortazzolaw.com.

How to file, whether it is for just you or jointly with your spouse, should be based on your unique situation and financial strategy. As your attorney, I can help you with both. As we work through your case, I can talk to you about the pros and cons of filing bankruptcy, whether you should file together with your spouse or alone, and when you should file, so you can make an informed decision based on your needs. After all, what is right for a friend may not be right for you.

Contact us today. We may be able to help get rid of that stress and help you get a fresh start. The consultation is free from your home, by phone or by video conference, and you'll get the information you need so you can move forward with your life. We look forward to helping you and working with you to solve your legal problems.

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Gavel and paperwork Florida

       Arna D. Cortazzo

Protecting Floridians' Rights for over 30 years.