Folsom Banruptcy Lawyer discusses the Effect of Bankruptcy on Spouse and Co-signers

A Folsom Bankruptcy Attorney Considers How Bankruptcy Affects Others

If you are thinking about or going to declare bankruptcy, then you need to consider two types of people who may have to deal with the effects of your action. In my bankruptcy office the other day, a person came in who had to make sure that they were taking into consideration both types of people—their spouse and someone who had cosigned on a loan for them.

Spouses and the Effect of Bankruptcy

If you declare bankruptcy and your spouse does not do the same, they are responsible for any loans, unsecured debt and secured debt, that they already share with you. In other words, they will have to pay joint debts.

If that’s the case, then it is important that your spouse also file for bankruptcy at the same time. By the way, for Chapter 7 this could double your exemptions, which is a great benefit, and for Chapter 13, it will prevent creditors from going after her/him.

Co-signers and the Effect of Bankruptcy

The co-signer on any loan you have taken out will be libel for the debt. One thing to consider is to have the co-signer listed as one of your creditors on your bankruptcy petition as they may decide to file a claim against you.

Carefully Consider Working with a Bankruptcy Attorney

As I tell my clients in Folsom and throughout Northern California, when you file for bankruptcy, especially Chapter 7 where much of your debt will be forgiven, you do have to consider how it will affect your spouse and cosigners on loans and take appropriate action. It is questions and considerations like these that make consulting with a bankruptcy attorney important.

Please contact our bankruptcy offices in California, serving Sacramento, Oakland, Santa Clara, San Francisco and other communities in Sacramento County, at info@california-bankruptcyattorney.com or at 888-589-1977 if you have any questions regarding bankruptcy.