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Does filing for bankruptcy have to include my spouse?

A popular question Louisiana couples have when filing for bankruptcy is if they should file for joint bankruptcy. Doing so will combine both of their properties and debts into the same filing.

However, this does not have to be the case. If one of you has significantly more debts than the other spouse, it might be better to file for a single bankruptcy case. Before you decide to choose one, it is important to know which option would be better for your circumstances.

Joint filing

If you and your spouse both have a similar amount and types of debt to pay off, filing for joint bankruptcy may offer a better solution. Doing so will erase almost all dischargeable debts that you owe both jointly and individually. If your spouse might be on the edge of bankruptcy in the near future, you could also save money from the court and attorney fees by filing jointly.

It is important to review what debts that you both owe jointly. Erasing those joint debts under a single filing will affect the credit score will affect the one who did not file.

Make sure to check any potential exemptions you can obtain if you file jointly. This can determine how much property that you get to keep and how much debt you have to pay off, so it is important to research the amount of exemptions the state of Louisiana can offer.

Single filing

If only one of you has a significant amount of individual debts to pay off, it is often better to file alone. Since bankruptcy reduces your credit score, it would not be wise to have both partners file.

One important thing to note is that Louisiana is one of nine community property states in the country. This means that even if you are filing alone, any property you and your spouse acquired after your marriage must be included in the bankruptcy filing. Any creditors you owe money to can go after your spouse as well.

If you are afraid of putting your spouse in the crossfire of a potential bankruptcy, you can sign an agreement with each other or the business you are working for to have your debts and incomes treated separately. It is important to review any debts you have before and after your marriage as well as the laws of community property states if you want to minimize the impact filing a single bankruptcy would have on your spouse.

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