Will filing for personal bankruptcy affect my spouse or co-signer of my debts?

If you are married and all of the loans were taken under your name only (your spouse was not a co-signer),  your spouse will not be affected if you file for bankruptcy.

However, to the extent any of the loans were co-signed or guaranteed by your spouse, he may be liable if you file for bankruptcy. The extent of his liability will be governed by the terms of the loan agreement you signed with the lender. Most loan agreements will indicate that in the event that you’re unable to repay the loan, your co-signer will be responsible for the entire debt.

Another common scenario – you might have a credit card account and you requested a supplementary card for your spouse. Again, the extent of your spouse’s liability if you file for bankruptcy will be governed by the terms of the credit card agreement that came with her supplementary card. Some credit card agreements will go so far as to stipulate that if he merely activates the card, he will be liable for the entire credit card balance, even if he never used the card.

In these cases you should obtain a copy of these loan and credit card agreements and review them with your trustee before making the decision to file for bankruptcy.