In a community property state, if I file bankruptcy will my spouse be held liable for debts I acquired before the marriage?

February 26, 2009 12:31 PM

I have heard conflicting information: in a community property state, if you file bankruptcy (not joint bankruptcy) is your spouse held liable for debt you acquired before the marriage?

Let me say upfront that I have a consultation for filing bankruptcy on Monday. I'm asking here because I want to make sure they're not just trying to make additional filing fees off of me by trying to persuade my spouse to file bankruptcy as well.

My spouse and I were married just a few months ago. We live in a community property state. Going into the marriage I had some debt. He's not a signer or co-signer on any of it or anything; our financial matters were completely separate. We haven't ever filed taxes jointly. We do not yet own any property together either, and neither of us own any real estate separately. The only notable thing either of us own is a car, which belongs entirely to my spouse. I am now looking into filing bankruptcy but whether or not my spouse will be liable for my debt will determine whether or not I file.

Some web pages say that my spouse will not be liable for the debt I had before marriage: 1, 2, 3

The woman I talked to on the phone, however, said that it doesn't matter if I acquired the debt before I got married, that my spouse will be liable for it. In other words, my spouse would have to file bankruptcy as well for anything to change.

Can anyone tell me which is true? On the one hand I'm suspicious since that doesn't seem to jive with anything I've read and they are in a position to make money off us, but on the other hand I don't know how trustworthy a bunch of websites are either. The place I'm getting the consultation is a place several relatives have used and it's supposed to handle more bankruptcies than anyone else, but I don't want to be given bad information just because they're a bankruptcy mill and think they can get away with it. I also don't want to show up to the consultation and accuse them of lying if they aren't, and if they are wrong, I'd like to have more to say than, "Well I read some websites..."

posted by anonymous to Work & Money (3 answers total)

IANAL, IANYL. That said, your spouse will not be liable for your debts before the marriage. She may be liable for debts you incurred after the marriage, even if she didn't sign for them. This could include credit card debts. The main idea is that both separate property and community property include both assets and liabilities.

Note that debt collectors will often go after anyone they think might be talked, bluffed, or coerced into paying them off. The fact that your wife is not legally liable may not spare her harassment.

You are always free to disagree with professional counselors, whether they be doctors, lawyers, accountants or interior decorators. You need not accuse them of lying, and you need not prove your assertions. If they suggest something that doesn't make sense to you, tell them that that was not your understanding, and ask them to prove it to you, say by showing you the relevant statute.
posted by ubiquity at 1:58 PM on February 26, 2009

Of your three links, one is talking about Texas law and the other about California. You need resources specific to your state.

I'd suggest that you're likely okay asking these questions of your lawyer. Bankruptcy mill or not, they are expected to hold to certain ethical standards. If you get the feel that they're not being responsive, fire them. There's plenty of lawyers in the sea.
posted by phearlez at 2:48 PM on February 26, 2009

This is a really tricky area of bankruptcy law. First, Title 11 applies nationwide, but there are 50 states and some number of territories that have their own laws. Then you have the bankruptcy district in which you are filing, which may have different case law. Then you have state community property law on top of that, and so you're looking at something that only an experienced attorney who handles bankruptcies (and you really need one post 2005 "reform") can suss out from your particular situation.

Generally speaking, no, your spouse will not be liable for debts not incurred during the course of your marriage. That's the way community property works. But how you can file bankruptcy properly given that particular information depends on a lot of factors such as whether you pass the means test, what your assets and income are, and what your debts add up to as well as their nature.

I don't think there's quite anything as a simple bankruptcy.
posted by dhartung at 10:29 PM on February 26, 2009