In many cases married debtors choose to file for bankruptcy together. There are many advantages to filing together. Many married debtors have joint debt. In cases where only one person files on a joint debt the other still has liability for that debt. For example, if a husband and wife own a home that is foreclosed upon, it may be advantageous to file bankruptcy to eliminate financial responsibility for any deficiency that may exist from the foreclosure. If only the husband filed for bankruptcy he will no longer have any legal obligation on the debt. However, if the wife does not file she is still legally responsible for the debt and creditors may try to collect from her by law suits, garnishments, and phone calls.
It is important to note, that in all cases, not just where debtors are married, if one person listed on a debt files for bankruptcy and the other person does not, the person that did not file is still financially responsible. Basically, if you and your significant other own a car, you filed for bankruptcy and he/she does not, he/she is still responsible. This is simply a more relevant issue when debtors are married because eliminating one spouse’s liability without the other doesn’t really accomplish much of anything. Further, married couples will generally save money on attorney’s fees by filing together instead of filing two separate cases.
Now, in some cases, debtors will file together, but later decide that they do not want to be a part of a joint bankruptcy. This may be for any number of reasons, including but not limited to, the spouses are separating or divorcing or one spouse is going to become entitled to a sum of money or property that would have to become a part of the bankruptcy estate. (Editors note: there are state specific elements of property rights that might make this evaluation different between a Missouri bankruptcy attorney and a Forsyth County Georgia bankruptcy lawyer).
You generally have a right to voluntarily dismiss you case. There are a few very limited exceptions to this rule that will not be discussed here. If one person no longer wants to continue your attorney can simply dismiss one debtor from the proceeding and not the other. Of course, in doing this, you want to weigh the fact that the dismissed party will still have a financial obligation to pay for any debt discharged in the bankruptcy unless he/she re-files.
If you have questions about whether or not you should file together, or whether one party should dismiss oneself from the case, you should speak with your attorney as soon as possible.
This guest article was written by Tobias Licker, St. Louis bankruptcy attorney.