You do not have to file bankruptcy jointly with your spouse. It is generally a good idea not to file jointly if only one of you is liable for the debts that led to the bankruptcy filing.
The Illinois State Bar Association explains that the court considers the liable person when assessing the debts you owe in a bankruptcy. If your spouse has no liability, he or she can avoid the negative credit aspects that come with filing.
One thing to keep in mind is that when you file for bankruptcy, you essential ask the court for protection from creditors. If you file alone, only you get that protection. For any joint debt, creditors can still go after your spouse.
It is also likely that the court will require your spouse to pay for any joint debts, which could bring about additional financial issues. You should carefully consider the debts you have jointly and how one of you filing for bankruptcy will affect the other person.
Bankruptcy and assets
Another consideration is how bankruptcy will impact your assets. If you file Chapter 13, you probably will not have too many concerns since you can save many assets. However, if you file Chapter 7, the court will consider all assets you own.
The court will not consider your spouse’s separate property, owned only in his or her name. However, it may consider marital property that you cannot exempt, which could lead to issues.
There are many things you must think about before filing bankruptcy alone when you have a spouse. You want to be sure it is the right decision that will be most beneficial to both of you.