Legal Question in Bankruptcy in California
My wife and I have been married 8 years, and she accrued a majority of her school loan debt while we were married. We looked into jointly filing Chapter 13 bankruptcy, but our combined debt puts us over the limit for Chapter 13. We have no property (we rent, have no 401K, nothing to sell, we have one financed car). All of my school loans are in deferment while I finish school. Can she file separately? What are the implications if she can file separately?
1 Answer from Attorneys
Generally, student loans are not dischargeable in bankruptcy, so, I assume that you are really interested in making a plan to repay all or a portion of your past due debt over a period of 3 to 5 years.
If you do not fit a Chapter 13, you might look into a Chapter 11. Individuals are eligible to file under Chapter 11. The process can be expensive, but it may be your only option in the bankruptcy system.
Your wife can file separately, but I do not see an advantage to it, based on your question. If your debts are community debts - incurred during marriage - you will still be stuck with the debts, even if your wife is discharged or she enters into a Chapter 11 plan.
Another option is filing under Chapter 7. It is likely that you would still have the student loans, but you may be able to wipe out ("discharge") the other unsecured debts. Check with an attorney about your eligibility for a Chapter 7. If your income is too high, this process may not be available.
Related Questions & Answers
Looking for something else?
10,200 active attorneys ready to answer your legal questions today.
Featured Attorneys
Earn additional revenue and grow your business.
