I'm married and I offered to buy my husband's boat because he needed money, as our accounts aren't joint. He takes care of the mortgage payments, and I handle all the other expenses: phone, cable, cell phones, groceries, etc. So I wanted to help him. The sale went through, but a month later, my husband told me he had to file for bankruptcy because he couldn't make ends meet anymore, and his outstanding debts were over $75,000. Since I bought the boat a month ago, if he files for personal bankruptcy, will I be affected, given that we're married? I don't want to lose what I've gained, especially since I didn't know he was going to go bankrupt.
The trustee in your husband's bankruptcy proceedings will examine the fairness of the price paid for the boat and the method of payment. If the price is lower than its market value, you will be asked to pay the difference. If you didn't pay for the boat but rather settled a debt your husband owed you, this will be considered a preferential payment, and you may have to surrender the boat to the trustee.
In short, the law requires that transactions between related parties not be made to the detriment of other creditors. All the facts must be analyzed and discussed with the trustee.
In short, the law requires that transactions between related parties not be made to the detriment of other creditors. All the facts must be analyzed and discussed with the trustee.
Questions reliées
- A month before our separation, we bought a boat using a joint line of credit. My ex kept the boat, which means I still have a loan in my name that I have no control over. What are my options for removing my name from the joint loan?
- A year ago, I signed a car-sharing agreement with my ex-partner. We have since separated, and I have experienced significant financial difficulties and am planning to file for bankruptcy. Given my inability to pay for the car, can I include it in the bankruptcy proceedings? If my ex is ultimately held responsible for the car, can he take legal action against me and demand payment or anything similar? The car payments haven't been made for four months, and it will soon be repossessed by the finance company.
- Are the monthly bankruptcy fees the same for everyone, or do they depend on income? Also, if my spouse and I both want to file for bankruptcy, will we have to pay twice or only once? We have joint debts and each have personal loans. How does this work in that case?
- Does a protection clause also apply to a tax/government debt if I inherit during or before bankruptcy proceedings? And if the death of the person leaving an inheritance occurs before bankruptcy but bankruptcy proceedings have not yet begun? Is that inheritance still subject to seizure?
- Does marrying someone who is personally bankrupt (not discharged) make me responsible in any way or affect me personally?