If I get divorced and then claim chapter 7 on my house..will I still be reliable for my wife's debt?

Question

I haven't got divorced yet but will be soon. I am chapter 13 on my house as of now. She is chapter nothing because she don't care and they are doing nothing to garnish her wages. My question is if I get divorced and then switch chapter 13 to chapter 7 will it wipe out my debt for me? For me and her? Or will I still be reliable for her debt since we bought the property while we was married and has both of our names?

Answer 1

Part of the divorce settlement will involve splitting up your assets and debts. Do you know who is going to get the house and the mortgage?

Answer 2

You need a tax lawyer.

Answer 3

Hi. First of all, you don't file Chapter 7 or 13 ON your house. When you file for bankruptcy, it impacts all of your debt. I'm sure your bankruptcy attorney has told you that Ch. 13 is a personal reorganization which give you time, up to 5 years to get your finances in order while making regular monthly payments to the court, which will then distribute to your creditors. Chapter 7 is often refered to as a "total" bankruptcy. In Ch. 7, you must, with the help of your attorney, pick what if any debts you wish to reaffirm. Most people reaffirm their home and car....that is if they wish to keep them. If you choose not to reaffirm, the property will be sold in an attempt to payoff your debt. If your home or car do not sell for enough to satisfy the debt, you are not liable. As far as your wife. When you filed Chapter 13, there is something called co-debtor stay in place. Since you filed, your creditors are prohibited from trying to collect the money from her until your case is resolved. If you case is dismissed or you convert to Chapter 7, she is fair game. The only way she is off the hook for her debt is if she files. About the house, I'm not sure what would happen to the house but you would not be liable for the debt.....you just may not have a house to go home to. I'm not familiar with what would happen to the house just because in most cases like this, both parties file for bankruptcy rather than just one.  I've worked in banking for many years and worked several years in collections. I've often wondered though why people file Chapter 13. Ch. 13 and Ch. 7 look the same on your credit. As a lender, if we see bankruptcy anywhere on your credit report within the last 5 years, we automatically disqualify you for a loan unless there is a special circumstance. Since this is the case, if you are under a load of debt, which obviously you are since you've already filed Ch. 13, why waste time filing Chapter 13. If your going to do it, do it right and file Ch. 7 and be done with it. Then everything is gone and your starting from scratch. Thats my opinion anyway. Hope this helps.