can we get married? or should we not?

[flaguy]

If anyone has any ideas at all on my situation I would appreciate it. I am going to be consulting with at least one BK attorney if not 2 just for the peace of my mind. I haven’t posted here in a few years but here goes with some of the bigger details.

Was a real estate developer who had 15+LLCs and a ton of property and wanted to get married back in 2009 but as the RE crash started all of my attorneys, cpa and other developer friends convinced me not to get married as the pending judgments would attach to my new wife and it would just complicate things. So we held off, over the last 5 years of court battles everything is pretty much gone except for 1 clean LLC that is what I live off of now. Had to move to another state to manage it (but that state had way better exemptions (Texas)). My fiancée has been planning on filing CH7 in the coming months once we get past the 2 yr anniversary of our residency here. Her case is a simple open and shut case as she has no taxable income (all goes through me) and all of her property and car will fall under the $30,000 exemption. Her only real debt and the reason she is filing are 2 deficiency judgments from our two houses that she was a cosignor on that total about 500K that were foreclosed out by a bank that I had a bunch of loans with that failed (new bank with FDIC loss share doesn’t play around or care). She literally only has a small student loan that is down to maybe 5k that she will keep paying on.

My situation is so complicated it isn’t even worth explaining past I have no idea what I actually owe LOL, but I know there are at least 10-12 judgments totaling over 3 maybe 4 million that are out there. Have been 1099ed for over a 1 million and another 10+ things/loans/ foreclosures have just disappeared and are going on 4-6 years old. I am what most would consider not collectable.
If we got married now ( last month was the last foreclosure and deficiency judgment, and for the first time in 5 years I am not being sued, and nothing else is coming) and she filed in a few months, would she be safe/ clean ie not on the hook for my debt at any point in the future? Or do we have to stay not married for that to happen? SO tired of this but not sure what we could be doing otherwise

[LadyInTheRed]

Your wife cannot be held responsible for debts you incurred before you are married. But, if you are married when she files BK, your income will have to be included on her means test. You don't say what your income is like. It may make sense for her to file before you marry if your income would disqualify her from a Chap 7.

If your case is complicted, you should definitely consult with more than one attorney and probably more than 2. Hopefully, you can file a Chap 7 because your debt is too high for a Chap 13. If you can't get a Chap 7 discharge, you may have to file Chap 11.

[Drazil65]

Hi, agree with you need to consult with several atty's I would guess. This situation is not something you want to mess around with, get several opinions. I would also agree that your fiancée should file before marriage, just seems more logical. Good Luck!

[flaguy]

Your wife cannot be held responsible for debts you incurred before you are married. But, if you are married when she files BK, your income will have to be included on her means test. You don't say what your income is like. It may make sense for her to file before you marry if your income would disqualify her from a Chap 7.

That makes sense, for some reason I thought they could pursue her as well.......my income isn't currently income (LOL, its return of capital that lowers my capital account balance)

whats the criteria for incurred before marriage? I wasn't kidding about things just disappearing (for example a house being foreclosed out but the bank not actually seeking the deficiency judgement (they have so many years to file for it), I get the random letter from a debt collector asking for it but that's it, if they get a judgment entered 3 years down the road and I got married 2 years down the road is she drug back in to it all? The debt would have been incurred long before the marriage they just didn't do anything about it

and thanks to both of you for the help

[LadyInTheRed]

That makes sense, for some reason I thought they could pursue her as well.......my income isn't currently income (LOL, its return of capital that lowers my capital account balance)

What is income for tax purposes may not be the same as what is income for purposes of the means test. I don't know whether receipts of returns of capital are considered income for purposes of the means test. But, that capital account is an asset that must be listed on your petition.

whats the criteria for incurred before marriage? I wasn't kidding about things just disappearing (for example a house being foreclosed out but the bank not actually seeking the deficiency judgement (they have so many years to file for it), I get the random letter from a debt collector asking for it but that's it, if they get a judgment entered 3 years down the road and I got married 2 years down the road is she drug back in to it all? The debt would have been incurred long before the marriage they just didn't do anything about it

It's when the debt was incurred that is important, regardless of wen they decide to do something about it.

If you get married before your debt is resolved, you should make sure not to comingle your assets. Make sure to keep clear what is hers and what is yours.

[flaguy]

What is income for tax purposes may not be the same as what is income for purposes of the means test. I don't know whether receipts of returns of capital are considered income for purposes of the means test. But, that capital account is an asset that must be listed on your petition.


It's when the debt was incurred that is important, regardless of wen they decide to do something about it.

If you get married before your debt is resolved, you should make sure not to comingle your assets. Make sure to keep clear what is hers and what is yours.

I am not filing anytime soon and might not file if no one ever gets to crazy about trying to collect, some of my judgments could be expiring as soon as 2/2015 and a lot of them were to banks that took over failed banks so they got their money from the FDIC through the loss share agreements. If they waste any time or money to collect on me now 85 cents on the dollar goes to the FDIC so I can't see them being that motivated.

On the comingling of assets; if she files and then we get married, what can they really do if it is an exempt asset? If for instance we buy a house together and this state has an unlimited homestead exemption. I get separate bank accounts and care title etc etc

[keepmine]

Unless Tx. is a T by E state and your home is titled that way your creditor could well place a lien against your half of the home making it impossible to sell until you file or settle with the judgment creditor.

It may also be tough to get a mortgage with a number of unsatisfied judgments against you.

[AngelinaCat]

You mentioned having had several LLCs. When you schedule your attorney consultations--at least three if not five--look for those who have experience handling bankruptcies for small businesses as well as individuals.