Being faced with unsecured consumer debt from accumulated personal spending is enough to make anyone lose sleep, especially when it is your spouse who is in debt and you are not sure what your legal obligations may be – but it doesn’t have to stay that way. Consumer bankruptcy in New Jersey may be the answer.
Consumer bankruptcy is distinguished from a business bankruptcy case, in that the debtor(s) who is filing the petition is an individual with mainly consumer debt, such as credit card debt, instead of business-related debt. There are a number of bankruptcy laws that relate to only consumer debt cases and not business debt matters.
One spouse does not owe the debt of the other spouse solely due to the marriage. The law in New Jersey holds that only the individual who contracted to pay the debt, is liable for the debt. Therefore, if only one spouse contracted with the credit card company / bank for the credit card, only that spouse owes the debt. Under this scenario, the bank may sue only the one spouse that is liable for the debt and not the other. If both spouses contracted with the creditor for a loan or credit card, than the debt is joint and the creditor may sue both spouses. Under this scenario, the debtor may obtain the money from either spouse, but only to the extent of the amount due. In other words, the creditor may obtain 50% from each spouse, or 60% from one and 40% from the other.
A joint bankruptcy case can only be filed by a husband and wife. There are numerous reasons why one spouse would file alone as opposed to filing jointly. If both spouses owe a debt jointly and only one spouse files for bankruptcy protection, the creditor may sue the non-filing spouse. However, if only the filing spouse owes the debt, the entire debt will be eliminated or resolved, as the non-filing spouse is not liable for that particular debt.
Filing for bankruptcy in New Jersey is a process that requires substantial personal and financial information / documentation, time and patience. Prior to filing, each spouse should be counseled on the advantages and disadvantages of filing bankruptcy alone or jointly.
As a Board certified consumer law bankruptcy attorney by the American Board of Certification, Robert Manchel has assisted numerous individuals in filing for bankruptcy in New Jersey. To learn more about how New Jersey bankruptcy lawyer Robert Manchel can help you with your particular situation, please call 866-503-5655 today.