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Declare bankruptcy, then get married

Dr. Don TaylorDear Dr. Don,
I am getting married a year from now. Will my filing for bankruptcy today affect my fiancé in the future?
-- James Juncture

Dear James,
Even after you're married, you will have separate credit reports. Keeping your credit separate after marriage, however, is a difficult proposition. Joint credit applications will show up on both of your credit reports, and even when one spouse is just an authorized user on the other's credit card, the account shows up on both credit reports.

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If you live in a community property state, then credit obligations entered into during the marriage are presumed to be joint obligations. The community property states are: Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington and Wisconsin.

A Chapter 7 bankruptcy filing stays on your credit report for 10 years while a Chapter 13 bankruptcy filing stays on your credit report for seven years. You won't have to wait that long to gain access to credit again, but it can take a couple of years before a creditor is ready to approve your credit.

Not saddling your new marriage with your old debts can make sense, but you will take the credit ramifications of filing for bankruptcy into the marriage. You'll want to keep your credit separate so you don't drag her credit rating down. When you need both incomes to qualify for a loan, such as a mortgage, her name should be first on the application.

Since President Bush signed the new bankruptcy bill into law, the bankruptcy code will be changing within six months. You shouldn't get cold feet about speaking with a bankruptcy attorney now and, if filing is the right move for you, do it under the existing bankruptcy codes.

-- Posted: April 27, 2005




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