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socrateaser, Attorney
Category: Bankruptcy Law
Satisfied Customers: 38878
Experience:  Attorney and Real Estate Broker -- Retired (mostly)
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My husband has two credit cards with outstanding balance and

Resolved Question:

My husband has two credit cards with outstanding balance and one auto loan with outstanding balance. Both credit cards and the auto loan (and auto) are under his name only. I am not an authorized users of any of those credit cards. Since he has trouble finding a job, he can not afford to pay them. He didn't have any other properties under his name. If he defaults on these credit cards and auto loans, what will happen? How will it affect me? The house we live in is under my name only. There are still some money in the bank join account, but it is not enough to pay for all debts. We live in NY.
Submitted: 7 years ago.
Category: Bankruptcy Law
Expert:  socrateaser replied 7 years ago.

If you brought the house that you are in into the marriage, then it is likely untouchable in your husband's bankruptcy, because it is not a marital asset. If the property was purchased with marital assets during marriage and put into your name only, then it's possible to allege that it is a marital asset, especially if the transfer was made during the past four years and you had some knowledge of the possibility that your husband might have to file for bankruptcy.


The point is that marital assets (jointly held property) is subject to creditor claims, whereas your separate property is not. Note that now that you are aware of the possibility of bankruptcy, any further transfers from your husband to you, which would reduce his exposure in bankruptcy and which would simultaneously operate to increase your separate property, can be avoided by the bankruptcy trustee as a fraudulent transfer. So, be careful about moving money/assets around, because you may get caught with your hand in the cookie jar.


Hope this helps.


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Customer: replied 7 years ago.

I bought my current real estate property more than 4 years ago under my own name only. I was already married to him at that time. This property is never joined with him and he never paid anything. Is this enough to prevent the creditors to touch my real estate property? When I married him, he still has a job. But he can not find any job during this recession.


Does "default on his credit cards and auto loan" mean he will has a record of bankruptcy?

Expert:  socrateaser replied 7 years ago.

I think you're okay. But NY's fraudulent conveyance laws are archaic, consequently, there's little certainty in outcome, because the state legislature has not seen fit to make the law correspond to what nearly all of the other 50 states are doing in this area.


No promises, but it looks pretty good to me. Your husband must discuss this with his bankruptcy lawyer.

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