05 Aug Marrying someone with a bankruptcy

 Q. My daughter is getting married to a guy who filed for bankruptcy after his divorce three years ago. What does she need to do to keep her credit from getting mixed with his? They’re planning to buy a house before the wedding.

A. While a marriage may link your daughter to her new husband, her credit won’t automatically be linked to his.

Credit reports are dependent on a person’s Social Security number, so a husband and wife can have very different credit scores if they keep their finances separate, said Ilisa Churgin Hook, a bankruptcy attorney with Hook & Fatovich in Wayne.

“Your daughter should keep any of her existing debts, including credit cards, separate and not add her financee/husband to those credit accounts,” Hook said. “Likewise, she should not be added to any of his credit accounts.”

If your future son-in-law has made timely payments to his secured creditor, such as a car loan or a mortgage on his prior marital home, his credit score has probably improved since his bankruptcy filing.

“A discharge in bankruptcy provides for a `fresh start’ and allows individuals to rebuild their credit scores,” Hook said. “However, if your future son-in-law has defaulted on any secured debt since his bankruptcy filing, or if he has overdrawn his bank account, your daughter may want to consider keeping separate bank accounts in her name only.”

An overdrawn line of credit on a joint checking account will show up on her credit report as well, she said.

Your daughter should verify if her fiancé filed a Chapter 7 or a Chapter 13 bankruptcy case. If he filed a Chapter 7 case and received a discharge, his case would most likely be closed by now, Hook said. But if he filed a Chapter 13 case and confirmed a 5-year payment plan, he would still be a debtor in a pending bankruptcy case.

“If he is currently a Chapter 13 debtor, he will need to get the Bankruptcy Court’s permission to obtain credit, including a mortgage to buy a house,” she said.

Assuming that your daughter and her fiancé are buying the house together and both plan to be on the deed and mortgage, his credit score and history will be considered when they apply for a mortgage, Hook said.

“I recommend that your daughter have a discussion with her fiancé regarding his current bankruptcy status — a closed Chapter 7 Case or a pending Chapter 13 case — as well as his current credit score prior to applying for a mortgage so that there are no surprises,” Hook said.

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This story was first posted in August 2015.