Another Question - Cars

[meddy23]

I currently own 3 older cars with my fiance, both our names are on all 3. We want to get rid of one, but the best one was vandalized and we haven't been able to afford to get it fixed. So I am currently driving the car we want to get rid of.

Ok, here's my question. If I file for Chapter 7, can they take the 2 extra cars? They are worth about $4000, $2500, and $800. The $4000 car is the one that is damaged, so its probably actually only worth half that right now.

Since there are two names on the registration, it seems to me that they should allow us to keep at least 2 of the cars. Am I correct in this, or can they force liquidation of 2 of the cars even though we share ownership?

BTW, if I do file, it will be before we get married, so my fiance shouldn't be liable for my debt, correct? We live in California.

[StaciMM]

Correct that your fiance shouldn't have any responsibility for your debt.

I don't know Ca's exemtions, but you probably won't lose the vehicles. Since your fiance owns half, the trustee would have to give him half of what is sold...

[AAAArt]

Staci is correct (as usual) if marriage is the only factor, however anything jointly owned or jointly titled, if you file individually, she will be responsible for the entire debt. Switching names on a title just b4 filing can be tricky, however if you could show that you merely re-arranged it so that 1 vehicle was in her name and 1 was in yours, it might fly. You really need to talk to an atty about this. Good luck, Art

[FoolAndHisMoney]

I'm kind of surprised that the whole "significant other" thing was left out of the new laws knowing that there are more and more couples same or opposite sexes that are doing this. I read the forms probably more times then bkfiler read pacer and found nothing on the issue. It simply states "married" or "spouse" and nothing more. It looks like "household" income is defined as a "spouse" and other "family members". As long as there are no joint accounts of any kind I imagine more financially troubled people will wait longer to get married. Seems like everytime the government fixes one problem they cause another. Most complain about people together and not getting married and this law too will prevent or delay more marriages.

[StaciMM]

Good point, FoolAndHisMoney. I'm sure the new laws want to consider 'household income' but it won't be so easy to enforce w/ 2 unrelated incomes. And-what about 'roommates'. Some people really are just roommates, no sharing of finances other than splitting the housing bills. It doesn't make sense that a roommate's positive cash flow should affect the others BK, but it will be a hard issue to distinguish between roommates and significant others.

[meddy23]

Thank you all for your comments. You've all brought up very valid points. We have an appointment with a bk lawyer on Dec. 28th and will definatly ask about all this.

Our finances have been completley combined for about 6 years. We both have about the same amount of debt, but I really think just one of us should file (worried about our ability to get a house soon). We've decided that it should actually be my fiance. His credit has dropped pretty significantly the last few months (just checked his credit report yesterday)(590) due to the business failing. Luckly, we kept all the business related stuff in his name, so it hasn't affected my credit (690). My credit still isn't great, but that is because of the amount of debt Im carrying. If he is able to file and get his debt discharged, we can be out of debt in less than 3 years.

Money has definatly played a major role in us putting off marriage. I really hope the fact that our money has been so inermingled won't hurt his ability to file.

[AAAArt]

Even though I don't know a hill of beans about the new law...If you're finances have been combined, anything you owe on under joint names, they will come after you for. You will be responsible for the entire debt...not just half. Your credit score will plummet and you will wind up declaring Bk w/in a year and it will cost you all twice as much.
Marriage is not the issue. Having both names on anything (debt or asset) is.
Art

[meddy23]

I didn't think about that...our credit cards are all separate. Its just our checking and savings account that is joint. I've just gotten so used to seeing them as joint, that I forget that they are all in one or the others name. We aren't even authorized users on each others accounts. Im just not sure how the bk will be affected considering our assets are almost all together. There have been balance transfers that we've made back and forth between our cards, but the last one was over a year ago.