Can I file for chapter 7 without my wife

[rubantin]

3 years ago we left our home because of a job transfer. That home never sold and is now going for short sale (It is in my name only). 2 months ago I lost my job and fortunately my wife started a job which is just sufficient for our family of 5 to survive. I have revolving debt of around $20,000 in my name only and when the short sale goes through in a week it will go for $60,000 less than I owe. So, there is a potential of me owing $80,000 with no job to pay for it.

Can I file a chapter 7 and not have my wife included on it or do I have to include her income and assets? And can she purchase a home without my credt ratings, etc as a first time home buyer?

BTW - I am a veteran and have a VA loan on the home.

[bcohen]

You don't say what state you live in, and laws vary on this matter. If you live in a community property state, then you can file alone, and your discharge will protect you and your wife from attempts to collect on any joint debt. If not, then you can still file alone, but your discharge will only protect you. It won't prevent creditors from going after your wife's wages, bank accounts, etc. Regardless, you must list household income and expenses so your wife's income and property still must be disclosed.

Also, the short-sale may not even add to your debt. If you live in a state where deficiency judgments on residential mortgages are not allowed, then you don't have to worry about that $60,000 shortfall. The lender will simply write it off, and you won't have to pay it. You may receive a 1099-C, however you are legally insolvent, and thus won't have to pay taxes on it.

[rubantin]

The home is in Delaware and the wells fargo short sale rep says they write it off especially because it's a VA loan. My wife has credit cards which she uses and I have my own cards. She keeps hers low balance and mine.. well... I have $16,000... Also, my job benefits extended to last month and my daughter had major surgery ~$55,000 which we will owe over 20%... So even if the short sale deficiency is written off, I still will have $27,000 of debt...



My wife is not on the mortgage.