Non-Traditional Households And Bankruptcy

When facing bankruptcy as a non-married couple or when you are in a non-traditional household, the information you receive can be confusing and overwhelming. The process for filing bankruptcy may not be as clear-cut as if you were single, living alone or married. This does not mean that it is impossible for you to file for Chapter 7 or Chapter 13 bankruptcy protection. It just requires you to have a knowledgeable and experienced attorney on your side who can assess your case and walk you through the process.

At Schwartz Bankruptcy Law Center, we provide comprehensive and tailored bankruptcy representation to clients in Kentucky and Indiana. Using our three decades of experience, we strive to help clients understand their rights regardless of their household or relationship situations. We believe everyone is entitled to a fresh start.

Navigating The Means Test

Whether you are a couple living together who is not married or your household is more untraditional than most, you will have to go through the bankruptcy means test. This is a complex formula that is designed to calculate your eligibility for bankruptcy. Your ability to pass or not pass the means test depends on the numbers and your ability to repay the debts you owe.

Passing the means test results in your ability to file for Chapter 7 bankruptcy. If you do not pass the means test, you must instead file for Chapter 13 bankruptcy.

Relationship Specifics For The Means Test

In regards to the means test, there are very specific rules for married and non-married people. However, the rules are less clear for individuals in other types of living arrangements, such as roommates or people who have lived together as husband and wife but are not legally married.

A common misconception is that you are only responsible for half of the debt you jointly signed. This is incorrect. Here's a simple example:

If you and your co-maker sign for a $10,000 loan, that does not mean that each is responsible for only $5,000. Rather, the law provides that each partner is responsible for the repayment of the entire balance of the loan until the full amount has been satisfied. This legal concept is called "joint and several liability."

Put Experienced Representation On Your Side

If you are a non-traditional household with a significant portion of debt weighing you down, then talk to the experienced attorneys at Schwartz Bankruptcy Law Center. We've handled hundreds of bankruptcy claims over the last 30 years and know what solutions work best in what situations.

Note: "common law" marriages are not recognized by Kentucky or Indiana. These parties may have entered into contractual agreements that must be considered when assessing their eligibility for bankruptcy.

For more information call our Louisville office at 502-485-9200, our New Albany office at 812-945-9200, or call either office toll free at 866-366-3328. You may also set up a free initial consultation online. Our attorneys are available for weekend, after-hours and in-home appointments upon request.