I'm so relieved I was told about this forum! I was told there were informed people here that could give me advice/opinions on my situation. We've always had good credit, but unbeknownst to me my husband recently ran up about $15,000 on five credit cards! He has no way of paying for this. I've always handled our bills (you can see why) and they've always been paid on time. However, I have no way of paying any of this debt. I've tried home equity, a consolidation loan, but we don't have enough equity to get the amount we need. My sister suggested as a last resort my husband file Chapter 7 (I don't even know what that is!). Our question is can he declare bankruptcy on his own without involving me? I am not a user on his credit cards and the one of our cars is in his name. I want to continue making car payments. If he can declare bankruptcy, would this be the best way to go? Can anyone give me some desperately needed advice? Thanks.
Before you consider BK, what state do you live in? If you live in a Community Property State (ID, WA, CA, NV, AZ, NM, TX, LA and WI) then the debts are yours also, and his BK would shift them to you. If you live in any other state, his BK does not affect YOUR credit rating per se, but you will still find it difficult to get credit if his income is needed to qualify. This would apply to a mortgage refinance, home equity loan, HELOC and other joint debt. As far as teh advisability of a BK is concerned, you really should talk witha alwyer in your state about that. The exemptions (what you get to keep after a BK) vary considerably from state to state. I suspect there is a more structural prpoblem than just tge $15K in credit card debt - why did he run up this debt? Compulsive behavior that needs to be addressed? Or a budget imbalance that also needs to be addressed. Take care of the underlying problem to ensure that it doesn't come back.
Hi jv, you can keep a certain amount of property in bk, but you really need to see a lawyer in your state. Is this all the debt you have? You need to look at the big picture, which would include all of your debt. It would include sitting down with your husband and make a decision,after you have seen a bk lawyer. Remember that credit counseling and bk lawyers are selling a product. Let them give you their take on your situation and then you decide what works for you. There are many knowledgeable people on this board. Previous post very good and to the point. Good luck.
Thanks so much for the information received so far. I have appointments with a credit counseling service and an attorney. But, as you say, they are selling a product and I want to do the best thing for us. I'm not sure I'll know what the best thing is though. This is pretty much all the debt we have. His behavior is due to an emotional problem which he is in therapy for presently. Also, he has destroyed the credit cards so I guess that's taken care of. I would still appreciate input/advice from others. Thanks again for your concern.
You may want to research credit counseling service before diving in - I've heard a lot of negatives... Here and @ Credit Boards
Its hard to give specific negatives, everyone's experience is different. Alot of it depends on the service you use, and the creditors involved. Out of about 10 cards in mine, I had one that was a jerk. Foleys dinged me every month with a new 90+ until their balance was paid in full. I have since been able to get that repaired. Part of my agreement was to not add more debt, nor seek new credit until the program was completed. Therefore I never looked at my report. Some creditors will hit you hard with "In credit counseling" notations and the like which are a hard hit to the reports. But! As soon as I got out of the program, all that stuff disappeared. Some will tell you it is worse than BK on your reports. I see the difference being that the BK notation can stay on 7-10 years (unless you can dispute it away), but the CCCS goes away when you are done with the program. Since my goal was to get my debt down, and not bring on more, the temporary hit to my reports was not important, my goals were long term. Its all about personal choices.
Thanks, jlynn! This is all new to me. Actually, as you can see, this isn't even my debt. My husband is the one with the problem. Unfortunately, I realize it effects me also. I agree that the credit counseling notation on your credit report seems better than a BK if it indeed goes away when you are finished with the program. I haven't committed to anything yet and hope that with input from the board, I'll be able to make the right decision. This is so scarey and so embarrassing!
