Separate before or after going bankrupt
June 1st, 2009 by Questions
I`m common-law with 2 dependents. My partner and I are planning on separating, we have joint debts- 2 bank loans, holiday trailer payment and a mortgage, there are is no equity in the house or trailer. I have $25000 in credit card debt and I want to file for bankruptcy. My partner does not want to file for bankruptcy. Is it better to file before or after we separate? My concern is my responsibility towards the joint debts, if I file for bankruptcy, we separate and I am left with my portion of the joint debt, and I cannot afford to pay it, I will be stuck. What are my options? Thanks.
Posted from: Alberta
One Response to “Separate before or after going bankrupt”
Please post a follow up comment below:
(Note: comments are reviewed by moderators and then posted after approval. In addition, due to high volume some of the comments might not be posted.)
You must be logged in to post a comment.
June 02, 2009 at 8:56 am, Barton Goth - Goth & Company Inc. -Trustee in Bankruptcy said:
The timing of a bankruptcy really isn’t going to make much difference here. When a bankruptcy is filed, all debt that you are listed on is included, this will include any joint debt. So legally speaking even if you are not separated and you file a bankruptcy, you then are legally no longer responsible for any of the unsecured creditors (with the exception of the debts that are not released by bankruptcy).
The result of this is that any joint debt that you may have had will be the responsibility of your partner as you legally are not able to make any payments on these debts.