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I want to file, but my spouse does not. Is that allowed and how will his/her credit be affected if I file alone? The answer to this question depends on whether you are filing Chapter 7 or Chapter 13: Chapter 7: You are permitted to file an individual case, even if you are married. If you file individually, only your debts will be included in the bankruptcy. If you have co-signed debts with your spouse, you will probably want to reaffirm those debts (sign a new agreement with the creditor and continue to pay). If you reaffirm the debts, and continue to pay, your bankruptcy should not negatively impact your spouse’s credit. I say it should not because federal law says so. As a practical matter, your spouse should verify that his/her credit has not been damaged by checking his/her credit report. In late 2002, a number of non-filing, credit damaged spouses filed a huge class action lawsuit against the three credit bureaus because of errors in the credit reports of non-filing spouses. It will be interesting to see how this case changes the way credit bureaus collect and verify information. If you and your non-filing spouse have a joint credit card debt and you choose not to reaffirm, the credit card lender can (and will) look to your non-filing spouse for payment after your case is over. Chapter 13: You are permitted to file an individual case, even if you are married. If you file individually, and you have co-signed or joint debts, you can pay the co-signed debts in full as a special payment class in your Chapter 13 plan. In most cases, you can pay co-signed debts at 100% even if you are paying other debts at 5%. If you choose not to protect your co-debtor in your Chapter 13 plan, the creditor can ask the Judge for permission to collect and sue the co-debtor.
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