Going Down With The Ship: Am I Responsible To Pay For My Spouse's Debts?
Leigh Stevens, Jay M. Weller, P.A. - January 2005

There are many myths related to joint debt liability with respect to married couples. At our law firm, we often hear from our clients that they are worried about addressing their debt situation because of how it will affect their spouses. Many of these concerns are warranted; however, it is often the case that people's apprehensions are based on popular myths, scare tactics used by collection agents, or misconceptions about a person's responsibility to pay for his/her spouse's debts.

The purpose of this article is to showcase some of the most popular myths regarding joint debt liability. Some myths we will cover relate to topics such as co-signing, bankruptcy, and divorce- although there are infinitely more. Without further delay ... here we go!

Myth #1:

I am responsible for my spouse's debts because of our marriage

Truth:

This is by far the largest misconception most of our clients have. A person can only be responsible for another's debts if he has agreed in writing to be jointly liable or has agreed in writing to serve as personal guarantor of the other party's performance on the contract. If a person has signed promising to pay along with somebody else, or has signed a promise to pay, in the event that somebody else does not, the Codebtor/Cosigner has indeed created liability for himself/herself.

Exception:

In some divorce settlements, a family court may require that there be some arrangement regarding the debts amassed during the years in which the couple was married. Sometimes, because of the family court order, a person who otherwise would not be responsible for another's debts becomes responsible through the divorce settlement. This judicially created obligation to pay DOES NOT change the original debtor's responsibility to pay. Therefore, if Jane was the only person responsible to pay on a Visa credit card, but the family court through the divorce settlement orders John to pay on this particular debt, if John does not pay, Visa will still attempt to collect from Jane, even though John has been ordered to pay by the family court.

Myth #2:

My spouse named me as an "authorized user"/ "account holder" on a credit card account, my spouse has not paid for some time, and now the credit card is claiming that I'm responsible to pay.

Truth:

This scenario is very much related to the one above, and is one of the oldest tricks that collection agents will use. An "account holder" is normally a person that has been authorized to use and enjoy all the privileges of the credit card account, but is not liable to pay. If the spouse did not sign along with his/her married partner accepting responsibility to pay, and has never signed any promise to pay on behalf of her partner, he/she is not liable on the debt.

Myth #3:

I will lose my property if my spouse files for bankruptcy.

Truth:

The only property that would potentially be at risk is property jointly held in some fashion (e.g. Tenants by the entirety, Joint, or Community). Therefore, any property in which the spouse is the sole owner would not be considered by a court in an individual bankruptcy filing.

Myth #4:

Both my spouse and I must file for bankruptcy if we want to save our house.

Truth:

If both can legally lay claim to the property, either one could file a bankruptcy petition to reorganize the debts related to the home and/or to stop a foreclosure action.

Myth #5:

When my spouse dies, I will be responsible for his/her debts.

Truth:

The only entity responsible for the decedent's debts is his/her estate. If the spouse was not formerly liable for a debt, the death of a spouse does not create an obligation to pay.

There are many more myths, half-truths, and misconceptions regarding debt liability as it relates to couples. Joint debt liability can become even more complex when bankruptcy is involved. If you feel that a bankruptcy may be right for you, but are worried about how your filing a bankruptcy may affect your spouse, please schedule an appointment with one of our very qualified attorneys.

Julian Credit Management is a firm that practices exclusively in the area of Bankruptcy and Debt Consolidation and has offices in Clearwater (Pinellas County), Port Richey (Pasco County), Tampa (Hillsborough County), Lakeland (Polk County) and Orlando (Orange County). We represent persons throughout the State of Florida.

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