My ex-husband is filing chapter 13 bancruptcy. My name is still on the mortgage because he has been unable to refinance or sell. What does that mean for me?
Also there is a credit card that is in my name but per the decree he is responsible for paying. The creditor has already given the account to a lawyer to collect as he has not kept up on his maintenance. I'm not sure what my next move should be.
The intersection of divorce and bankruptcy is always difficult. As the other responses have pointed out, the creditors were not a party to your divorce settlement. They are therefore not bound by the allocation of the debts between you in the divorce decree. However, it is very common for divorce documents to contain "hold harmless" provisions. A hold harmless provision operates to protect the spouse that was not allocated a debt by stating that if that spouse is required to pay the debt by the creditor he or she can then seek repayment from the spouse that should have made the payment under the decree.
The hold harmless provision is, in itself, an obligation or debt that should be scheduled in the bankruptcy. In other words, you become one of your ex-husband's creditors who desires to have the hold harmless obligation enforced. Whether the hold harmless obligation to you can be discharged by your ex-husband depends on the nature of the debts that were allocated to him that you want to enforce under the hold-harmless.
If the debts allocated to him were in the nature of a property settlement then his obligation under a hold-harmless can be discharged in Chapter 13. If, however, the allocated debts are in the nature of a domestic support obligation then the hold-harmless obligation can not be discharged in Chapter 13 or Chapter 7.
Determining whether a bankruptcy court would agree that the allocation of debt and hold harmless are in the nature of a domestic support obligation can be a tricky analysis. It's not as easy as looking at the documents and trying to find the presence or absence of the word "support" or "alimony" or something along those lines. It typically requires a more complete review and understanding of the total circumstances of the divorce and intent of the parties at the time of the divorce. It may even be possible that one debt could be viewed as a domestic support obligation and the other could be viewed as part of a property settlement (and that they would therefore be treated differently).
You really ought to consult with a very experienced bankruptcy attorney in your area before you make a decision as to whether you are going to claim the hold-harmless obligation is not subject to discharge. It's not as easy as saying "well it's Chapter 13 so it can be discharged", but it's clearly also not as easy as saying "well I thought it was a domestic support obligation so it's cannot be discharged."
Neither your husband's bankruptcy nor the property settlement in your divorce affect your liability to your creditors. If your husband does not pay the mortgage or the credit cards, regardless of whether he is required to or not, you will remain liable on them and they can take whatever actions against you to collect as are allowed under your state's laws.
Moreover, since he filed a Chapter 13 case, the obligation your husband owed to YOU for the marital debts can be discharged in his bankruptcy case. At the very least, you should file a proof of claim in his bankruptcy case for the amounts he owes you pursuant to the divorce court order. Aside from that, you will need to assess the best way for you to deal with your remaining liabilities, whether by negotiating with your creditors or possibly filing a bankruptcy case yourself. You should consult with an attorney in your area.
Mark J. Markus, Attorney at Law
Handling exclusively bankruptcy law cases in California since 1991.
bankruptcy blog: http://bklaw.com/bankruptcy-blog/
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Your credit report will likely, but not definitely, indicate that your co-debtor filed a bankruptcy. It is unclear as to whether this should be on your credit report. If it does appear, I would suggest you write to the credit bureaus ( if you obtain a credit report, it will come with instructions for disputing information or correcting inaccuracies ) and indicate that you wish to have this removed from your credit report since it is not your bankruptcy.
Your next point raises an interesting question, whether your ex can pay this debt in his Chapter 13. My intuitive answer is that he cannot, it is not his debt, he has no contractual obligation with the creditor.
If you wind up having to pay the debt, you may need to file a motion in your domestic
relations court to enforce the provision of the divorce judgment requiring him to pay the debt.