When money gets tight, bankruptcy can feel like a reset button. Some couples file together, others choose to file on their own, especially when filing for bankruptcy during divorce makes joint decisions more challenging. This choice is personal. It affects you, your spouse, and how your household moves forward.
Filing on your own can give you breathing room from heavy debt. Still, look at how that move touches the things you own together, like a home, a car, or joint accounts. The spouse who does not file may still be on the hook for certain balances, and jointly held assets could be pulled into the case.
Your decision can shape both of your credit profiles. It can influence how soon you qualify for new credit and how well you can protect property you share, including any potential filing bankruptcy disqualification concerns if you’ve filed before. Take a clear look at your goals, your assets, and your risks so you pick the path that fits your situation.
At Straffi & Straffi Attorneys at Law, we understand the stress and uncertainty that come with financial struggles. Our New Jersey bankruptcy attorneys work closely with clients to help them make decisions with clarity and confidence. If you’re considering bankruptcy and wondering whether an individual filing is right for your situation, we invite you to speak with our team. Call Straffi & Straffi Attorneys at Law today at (732) 341-3800 to schedule a confidential consultation. Let us help you take the next step forward.
Can a Married Person File for Bankruptcy Without Their Spouse?
You can file for bankruptcy on your own in New Jersey. Your marital status does not change that. In New Jersey, there is no legal requirement for both spouses to participate in the same bankruptcy case.
You still keep that right even if you and your spouse share a home. For eligibility and payment planning, the means test looks at income in your household. It counts your spouse’s income only when it regularly helps pay shared bills. That’s where the marital adjustment comes in. Money your spouse uses for their own expenses or for people who are not your dependents is taken out of the calculation.
Your spouse is not a party to your case. Still, their income can affect your path. It can make a difference in qualifying for Chapter 7 or in the size of a Chapter 13 plan payment.
Reasons One Spouse May Choose to File Alone
There are situations where it may be more beneficial for only one spouse to file. This decision often depends on the nature of the debt and how assets are titled.
- The majority of the debt is in the name of one spouse only.
- One spouse has strong credit and wants to avoid damage to their score.
- The couple plans to maintain access to financing through the non-filing spouse.
- One spouse previously filed for bankruptcy and is not yet eligible to file again.
In such cases, filing individually may offer targeted relief while preserving the financial standing of the household.
Situations Where Joint Filing Might Be Preferable
Although individual filing is allowed, there are scenarios where filing jointly can provide a more comprehensive solution.
- Most debts are jointly held, and discharging them together avoids further collection against the non-filing spouse.
- A joint filing may result in lower total legal and filing fees compared to filing separate cases.
- Both spouses need to stop creditor actions such as lawsuits, wage garnishments, or foreclosure.
In these situations, a joint bankruptcy can streamline the process and offer a fresh start for both spouses, particularly when both are affected by financial hardship.
Exploring the Benefits and Drawbacks of Joint Bankruptcy
The option of joint bankruptcy in New Jersey allows couples to manage financial difficulties efficiently and economically. Here’s why it might be a beneficial route:
- Double Exemptions: New Jersey permits the doubling of federal bankruptcy exemptions for joint filers, providing the opportunity to protect a larger amount of assets from liquidation.
- Comprehensive Debt Resolution: A joint bankruptcy filing has the potential to clear all dischargeable debts for both partners, avoiding the scenario where one spouse remains liable for certain debts.
Despite these advantages, there are situations where joint bankruptcy may not be the most advantageous:
- Excessive Property Ownership: If one spouse owns considerable separate property, joint filing might not sufficiently cover all assets with exemptions, and individual filing could be more protective for the non-filing spouse’s property.
- Significant Priority Debt: When dealing with a large amount of priority debt, such as taxes or alimony, a Chapter 13 bankruptcy requires full repayment, which could be challenging for couples with limited income when filing jointly.
Joint bankruptcy in New Jersey offers a unified approach to financial recovery for couples, with efficiency and financial savings at its core. However, the decision to file jointly should be balanced against any potential disadvantages related to asset and debt considerations. Couples are encouraged to consult with a bankruptcy attorney to ensure they make an informed choice that aligns with their specific financial circumstances.
Understanding the Automatic Stay and Co‑Debtor Protections
When you file bankruptcy in New Jersey, the automatic stay takes effect the moment your petition is filed. It stops most collection activity, including lawsuits, wage garnishments, foreclosure sales, repossessions, and collection calls. Creditors have to pause unless the court later grants relief for cause. Some actions continue, like child support and certain tax matters, and repeat filings within a year can limit the stay’s duration.
If only one spouse files, the stay protects the filing spouse and the bankruptcy estate. In Chapter 7, a creditor may still pursue the non-filing spouse on joint debts because that person is not covered by your stay. In Chapter 13, an extra safeguard applies: the co-debtor stay. It temporarily blocks collection from an individual who is liable with you on a consumer debt, such as a joint credit card or a cosigned auto loan. Business debts are excluded, and many tax liabilities are not covered because they are not consumer debts. The court can lift this protection if your plan will not pay the claim in full or if the co-debtor received the benefit of the loan. The protection ends if the case is dismissed or converted.
Choosing Chapter 13 can also let you keep property while paying debts over three to five years, which often gives families the breathing room they need. A New Jersey bankruptcy attorney can review your joint accounts, recommend the chapter that best protects your household, structure a plan to address co-signed balances, handle motions to lift the stay, and explain what creditors may still do in your case.
Can My Wife File for Bankruptcy Without Affecting My Credit?
A spouse’s individual bankruptcy filing does not automatically impact the other spouse’s credit report in New Jersey. Credit histories are maintained separately, and one person’s filing will not be recorded on the other’s report unless there are shared debts or joint financial responsibilities involved.
If your wife files for bankruptcy on her own and you are not listed as a co-debtor or co-signer on any of her accounts, your credit report should remain unaffected. The bankruptcy will appear only on her file and will not influence your credit score or public record.
To protect your credit, it’s important to review which debts are in your name alone, which are shared, and how creditors report each account. Maintaining current payments on any joint obligations can also reduce the risk of negative entries on your credit report.
What Happens to Shared Property in an Individual Bankruptcy?
In Chapter 7, a trustee is appointed to identify and liquidate non-exempt assets. For co-owned property, the trustee can ask the court for permission to sell both the estate’s and the co-owner’s interests together if specific conditions under 11 U.S.C. § 363(h) are met (for example, partition is impracticable and the sale benefits the estate more than it harms the co-owner). If the court authorizes a sale, the trustee must distribute the net proceeds between the estate and the co-owner according to their interests under § 363(j).
Equity Exemptions for Married Couples in New Jersey
In New Jersey, individuals can choose either the state or federal exemption scheme. As of April 1, 2025, the federal homestead exemption protects up to $31,575 in equity in a primary residence; in a joint case, each spouse may claim exemptions separately (so effectively up to $63,150 if both spouses have an interest in the home).
Conversely, New Jersey’s state exemptions do not include a specific homestead exemption. Instead, they provide protections for personal property, such as up to $1,000 for household goods and furnishings. Additionally, married couples filing jointly may be able to double certain exemption amounts, thereby enhancing asset protection.
Given the differences between the federal and state exemptions, individuals should carefully evaluate which set aligns better with their asset protection needs when considering bankruptcy in New Jersey.
New Jersey Bankruptcy Attorney – Straffi & Straffi Attorneys at Law
Daniel Straffi, Jr.
Daniel Straffi, Jr. is a New Jersey bankruptcy attorney who has been advocating for individuals and businesses since 2001. Admitted to practice in New Jersey, Pennsylvania, and the U.S. District Court for the District of New Jersey, he brings a steady, solutions-oriented approach to complicated financial matters. His early service as a judicial law clerk to the Presiding Judge of Family Law in Mercer County, the Hon. Lee Forrester, P.J.F.P., and subsequent work in negligence defense at Cooper Levenson provide him with a 360-degree understanding of litigation strategy and negotiation.
A graduate of Boston College (1998) and Rutgers–Camden School of Law (2001), Mr. Straffi joined his family’s firm in 2004. Today, his practice focuses on bankruptcy along with divorce and criminal defense, and he remains deeply engaged in the legal community as an active member of the New Jersey and Ocean County Bar Associations, Co-Chair of the Ocean County Bar Association’s Bankruptcy Panel, a certified mediator, and an early settlement panelist in Ocean County.
How Bankruptcy Affects a Non-Filing Spouse
When one spouse files for bankruptcy in New Jersey, the decision can have significant implications for the other spouse. These effects can influence credit standing, liability for joint debts, and the management of marital assets. Both parties should be aware of these potential outcomes.
Impact on the Non-Filer’s Credit Report and Score
A bankruptcy filing by one spouse does not directly appear on the credit report of the non-filing spouse. Each person’s credit history is kept separately. Having joint debts, however, creates a more involved financial situation.
- Joint Debts: As mentioned, If both spouses are co-signers or jointly liable for a debt, the bankruptcy discharge will relieve the filing spouse of their obligation, but the non-filing spouse remains fully responsible for the entire debt. Creditors may continue collection efforts against the non-filing spouse, and any missed payments or defaults can be reported on their credit report, potentially lowering their credit score.
- Credit Reporting: While the bankruptcy itself won’t be noted on the non-filing spouse’s credit report, the status of joint accounts may be updated to reflect the bankruptcy, which could indirectly affect the non-filer’s creditworthiness.
It’s advisable for the non-filing spouse to monitor their credit report and maintain timely payments on any joint obligations to mitigate negative impacts.
Responsibility for Joint Debts After One Spouse Files
In New Jersey, when one spouse files for bankruptcy individually, the non-filing spouse’s responsibility for joint debts remains unchanged. Creditors retain the right to pursue the non-filing spouse for the full amount of any joint obligations. Creditors can initiate or continue collection actions, including lawsuits, wage garnishments, or bank levies, against the non-filing spouse to recover joint debts.
It’s essential for couples to assess the extent of joint debts and consider strategies such as refinancing or consolidating debts solely in the name of the non-filing spouse to protect their financial stability. Consulting with a bankruptcy attorney can provide guidance on managing joint debts and exploring options to safeguard the non-filing spouse’s financial interests.
| Factor | Individual Filing (One Spouse) | Joint Filing (Both Spouses) |
|---|---|---|
| Credit Impact | Only the filing spouse’s credit is affected. | Both spouses’ credit is affected. |
| Liability for Joint Debts | The non-filing spouse remains responsible for joint debts. | Joint debts are discharged for both spouses. |
| Asset Protection | Only the filing spouse’s assets and share of joint property are included. | Assets of both spouses are included; exemptions may be doubled. |
| Income and Means Test | Household income is considered, but marital adjustment may apply. | Combined income is used for qualification. |
| Filing Cost | May require two separate filings and higher total costs. | One filing with shared fees and a simpler process. |
| Best For | When most debt is in one spouse’s name or to protect one spouse’s credit. | When debts are shared or both need financial relief. |
New Jersey Laws on Marital Debt and Asset Protection
New Jersey follows common law principles regarding marital property, which affects how debts and assets are treated when one spouse files for bankruptcy.
As discussed, property solely in the non-filing spouse’s name is generally not part of the bankruptcy estate and is protected from creditors. However, jointly owned property may be subject to the bankruptcy proceedings, depending on the equity and applicable exemptions.
New Jersey recognizes tenancy by the entirety for married couples, which can limit an individual spouse’s judgment creditor from forcing a partition or sale of the marital home. But in bankruptcy, a trustee may still seek a sale of entireties property if the requirements of 11 U.S.C. § 363(h) are met, and jointly owed debts or liens can also expose the property. In short, entireties ownership offers meaningful protection from a single-spouse creditor under state law, but it is not an absolute shield in bankruptcy.
Careful consideration of these legal nuances is vital for protecting marital assets and managing debt responsibilities effectively. Seeking legal counsel can help develop a strategy tailored to the couple’s specific circumstances.
Moving Forward with Legal Help From New Jersey Bankruptcy Lawyers at Straffi & Straffi Attorneys at Law
When one spouse files for bankruptcy independently, it introduces unique challenges and considerations. Our attorneys are well-versed in New Jersey bankruptcy laws and can help you assess how an individual filing may affect both spouses’ financial responsibilities and assets. We work closely with you to evaluate your specific circumstances, ensuring that you are informed about the potential advantages and risks associated with filing individually.
Our firm offers personalized support throughout the entire bankruptcy process. From determining eligibility and selecting the appropriate type of bankruptcy to preparing and filing necessary documentation, we are here to assist you every step of the way. We also provide strategic advice on managing joint debts, protecting shared property, and understanding the implications for the non-filing spouse.
At Straffi & Straffi Attorneys at Law, we prioritize clear communication and empathetic service, aiming to alleviate the stress associated with financial uncertainty. Our goal is to help you achieve a fresh financial start while safeguarding your family’s well-being. If you are contemplating bankruptcy and wish to understand your options, contact Straffi & Straffi Attorneys at Law at (732) 341-3800 to schedule a consultation. Together, we can explore the best path forward tailored to your unique situation.
