There is no requirement that both spouses file jointly in either CHAPTER 7 or CHAPTER 13 BANKRUPTCY.
Economically, it makes sense because the couple only has to file one case and pay one filing fee ($306 in CHAPTER 7 and $281 in CHAPTER 13).
It all has to be evaluated on a case by case basis. That’s why it is so important to get good counsel. All of the bad debt may be in one spouses name – so we would file that spouse so that they could both benefit from the other’s good credit.
I ran across a real strange situation recently where a client violated 2 of the 3 big no no’s in filing for bankruptcy. No no number 1 is to not make any preference payments to general unsecured creditors within 90 days of filing or make a loan repayment to a relative within 1 year before filing. Rule number 2 is never ever transfer anything out of your name for less than fair market value. And – of course – rule 3 is “TELL THE TRUTH.”
One spouse sold a titled vehicle to a relative for 50% of the fair market value (FRAUDULENT TRANSFER) and then paid off a lien on another vehicle where the loan had been in default for a long time (VOIDABLE PREFERENCE). There is a 2 year look back on transfers.
Fortunately, we can file the working wife and avoid a garnishment. But – even after going over the “3 Big No No’s” over and over – some people just do whatever they want and don’t think to call to get any advice before they create their own problem.
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