Hi there, I just joined today so please excuse me if a similar post has been discussed already (perhaps you could point me to it if that is the case?).
Anyway, my husband left me 7 months pregnant with a 20 month old toddler recently. Neither of us can afford an actual divorce at this time because the grounds require court appearances (filing before the 1 year separation) so we are separated, but I had initiated paperwork to file a legal separation agreement. He has a spending problem, and over the years, has used my credits cards to rack up a debt of about $50k (I, myself, only have debt in the amount of $8k in student loans not included in that number and that is it as I was always able to live within my means). He is refusing to admit it was him and is insisting it was all my debt. Because of that, he is refusing to pay for any of the debts in my name since these cards are only in my name, and he isn't on the account (although he would use them for online purchases or bully me into agreeing to an in-person purchase where a signature was required, I know it sounds silly, but he was very emotionally abusive and I would cave in the hopes that it would end the abuse and that he would get help afterward for both problems).
Because it will be easier for the kids and me in the long run vs going into further debt to pay for court, I am having to claim bankruptcy. As noted above, I do not have our separation agreement filed yet, but he IS paying me child support monthly for both kids already even though one is yet to be born. We are now on our way to being close friends again, but he is hung up on the bankruptcy aspect possibly affecting him or his credit based on what his family is telling him.
I recently met with a trustee to see what the process would entail and what my options were. She said even though I don't have to claim child support for tax purposes, as soon as I file for bankruptcy that child support is automatically counted as household income, even though it is for the children and not for me. Same thing with any government baby bonus or child care tax credits I'm eligible for.
Because I make almost as much as the cut-off for "reasonable allowable income" set out by the bankruptcy laws, if I were to have the separation agreement finalized and filed, I would then have to claim the child support -- my kids would not see it and the trustee would force me to hand every penny over to them to pay creditors since that would then put me over the cut-off for allowable income. My ex has been totally supportive of paying me cash under the table so we both know it goes directly to the kids, which is what it is for.
He's now approached me asking me if we can have the agreement filed because his family is trying to tell him once the new baby is born I am going to turn on him and hate him, and go after him for everything (which is silly because I technically make slightly more than him so I cant go after him for anything anyway, even if I wanted to). He said he'd give me the benefit of the doubt because he trusts me, but he wanted me to know that he'll try to take the kids from me if I tell him the bankruptcy won't really affect him if I file without the separation agreement in place, and then it turns out it does affect him.
I HAVE retained a lawyer which has been working on my case since we split and she's been drafting the separation agreement for me/us, but we just haven't filed anything. She has records of our wishes and what date we actually separated. I was told by the trustee that even if my ex was still on the deed to my house and mortgage, etc., that my bankruptcy would not affect him at all if we actually are separated and not living in the same house. She also told me it would help me (without affecting him) if he stayed on the mortgage and deed to the house because if there were any equity in the house, the creditors can only go after half of the equity because half technically belongs to him and they can't touch him if we are not together.
Anyway, my big question about this is, has anyone else been in a similar situation and had to file for bankruptcy? If so, what happened? Did you have your divorce or separation finalized before you did it or are/were you in the same boat as me?
Something unique to my situation is that my house was purchased from family and they hold my mortgage privately (I pay them monthly and no banks or creditors are involved) so I can keep the house as I'm able to actually pay the mortgage and household bills, just not that AND my ex's credit card debt. I was also told there is little to no, possible even negative, equity on the house since my ex started ripping the place apart to renovate and just left it unfinished, so I likely won't owe anything at all to the trustee for the house. My family would also not allow me to lose the house, so they would not ask the trustee for the money either.
Anyone have any advice? I'm a little lost and don't know what to do -- do I file the separation agreement including the amount of child support on there and not get to actually use it for my kids or do I go ahead claiming bankruptcy and file the agreement after it's over so they can't touch the child support? So lost :(