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Spouse has abysmal credit...

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Midwestsho
Established Member

Spouse has abysmal credit...

I'm recently married and my wife's credit is terrible.  She has a 550 score with about $13000 in unpaid medical expenses.  In addition to the medical expenses she has some credit cards that aren't paid but they're all small amounts. None of the debt has been accrued since we've been married.

 

I'm not sure how to go about fixing this.  It doesn't really bother her but it bothers me, both in that I feel her problems can come back to haunt both of us and because I'm concerned that she couldn't be financially dependant if she needed to be. So I've got some questions:

 

  1. If her debt was accrued before our marriage, can her creditors come after me if they're ignored?
  2. Can she declare bankruptcy without me declaring bankruptcy as well?  My credit is fine and is the manifestation of a couple years of hard work.  If she can, does this affect how I file taxes (joint or separate)?
  3. Should I pay off the "easy" debt and just try to get the medical bills discharged?  There's about $2700 worth of smaller stuff that she ignored for whatever reason, that I plan on paying off either way.  It's the medical bills that are my main concern and they make up the majority of the debt.

Any advise is much appreciated.

Message 1 of 5
4 REPLIES 4
JM-AM
Valued Contributor

Re: Spouse has abysmal credit...

 


@Midwestsho wrote:

I'm recently married and my wife's credit is terrible.  She has a 550 score with about $13000 in unpaid medical expenses.  In addition to the medical expenses she has some credit cards that aren't paid but they're all small amounts. None of the debt has been accrued since we've been married.

 

I'm not sure how to go about fixing this.  It doesn't really bother her but it bothers me, both in that I feel her problems can come back to haunt both of us and because I'm concerned that she couldn't be financially dependant if she needed to be. So I've got some questions:

 

  1. If her debt was accrued before our marriage, can her creditors come after me if they're ignored?
  2. Can she declare bankruptcy without me declaring bankruptcy as well?  My credit is fine and is the manifestation of a couple years of hard work.  If she can, does this affect how I file taxes (joint or separate)?
  3. Should I pay off the "easy" debt and just try to get the medical bills discharged?  There's about $2700 worth of smaller stuff that she ignored for whatever reason, that I plan on paying off either way.  It's the medical bills that are my main concern and they make up the majority of the debt.

Any advise is much appreciated.


 

Do you know how old the debt is (DOFD)?

 

1. Do you live in a community property state? If you do then IMO you need to speak to an Attorney. If not then I believe her debt before marriage can not be charged to you.

 

2. Yes she can declare BK with-out you. As far as taxes are concerned yes it is best to file separately only if she has a judgement against her. IMO since the debt doesn't bother her and she doesn't really care about her finances I would file separately not to risk the point she was served a judgement and ignored it and may not be showing on her Credit Reports.

 

3. If you are going to have her file BK then no sense in paying the other debt. Just include it all in the BK. Paying off the other debt and just filing BK on the medical will have the same impact on her credit as if she just filed BK on all the debt.

Good Luck
May all your dreams and wishes become a reality!
Message 2 of 5
Anonymous
Not applicable

Re: Spouse has abysmal credit...


@JM-AM wrote:

 

3. If you are going to have her file BK then no sense in paying the other debt. Just include it all in the BK. Paying off the other debt and just filing BK on the medical will have the same impact on her credit as if she just filed BK on all the debt.


I'll just add my two cents on this one.  For me, it was important to pay off as much debt as I possibly could before filing BK.  My feeling is if you CAN pay it, you should.  It's an integrity thing.  BK is for those debts you cannot pay.

 

Also, I'm not sure where the boundaries are for filing BK with or without spouses.  When DH filed BK 13, I had to be included. Definitely a good idea to meet with a local BK attorney (hopefully meet with 2 or 3) and go over your situation with them.  Most BK attorneys do a free consult - however they are in the business and will encourage you to file.  You may want to look at other legitimate possibilites as well.

 

I would also encourage your spouse to participate in some type of financial education that she feels comfortable with.  Finances, or at least the handling of finances, are key in a stable marriage.

 

Best wishes to you!

Message 3 of 5
Anonymous
Not applicable

Re: Spouse has abysmal credit...


@Midwestsho wrote:

I'm recently married and my wife's credit is terrible.  She has a 550 score with about $13000 in unpaid medical expenses.  In addition to the medical expenses she has some credit cards that aren't paid but they're all small amounts. None of the debt has been accrued since we've been married.

 

I'm not sure how to go about fixing this.  It doesn't really bother her but it bothers me, both in that I feel her problems can come back to haunt both of us and because I'm concerned that she couldn't be financially dependant if she needed to be. So I've got some questions:

 

  1. If her debt was accrued before our marriage, can her creditors come after me if they're ignored?
  2. Can she declare bankruptcy without me declaring bankruptcy as well?  My credit is fine and is the manifestation of a couple years of hard work.  If she can, does this affect how I file taxes (joint or separate)?
  3. Should I pay off the "easy" debt and just try to get the medical bills discharged?  There's about $2700 worth of smaller stuff that she ignored for whatever reason, that I plan on paying off either way.  It's the medical bills that are my main concern and they make up the majority of the debt.

Any advise is much appreciated.


1.  No.  Unless the debt is for something which ultimately becomes a marital asset or for a concept that continues for a period of time after marriage, even in a community property state they cannot go after you.

 

2.  Yes.  Not sure about the tax aspects.

 

3.  Personal call.  I, for one, would think that paying those debts makes little financial sense since they would ultimately be discharged and the damage to her credit will not be lessened by paying them. 

 

One thing I would look at before filing for bankruptcy is exactly how old those debts are.  As long as they are past the statute of limitations, the creditors cannot take legal action against you and there is little practical value in declaring bankruptcy. 

Message 4 of 5
Restore2011
Member

Re: Spouse has abysmal credit...

In my State (and we are Community Property here) I was able to file Ch. 7 separate from my ex-husband. We were married but separated at the time but the Trustee didn't care about that. LOL. I still had to have him sign something that basically said I was filing by myself and that he and his finances had nothing to do with it.

 

One creditor that I had caught up with him about some debt that was included in the BK, trying to scare him into thinking it was his responsibility. I told him that if they ever called back to tell them that the debt had been included in a BK and that if they continued to contact him they were in violation of law. I don't know that they ever contacted him again.

*******
Ch. 7 BK discharged 7/09
myFICO pull 1/11
TU: 629 EQ: 667
Goal: Forget the score--I just want a house w/a comfie fixed mortgage! Smiley Happy
But I guess the 700 club couldn't hurt!
Message 5 of 5
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