What is a husband’s liability for a loan co-signed by his wife?

Get Legal Help Today

 Secured with SHA-256 Encryption

What is a husband’s liability for a loan co-signed by his wife?

My wife and I are in the process of getting a divorce. During our marriage my wife co-signed for a loan for her son, my stepson. He is considering filing for Chapter 7 bankruptcy because of an inability to repay this loan and other debt. I know that my wife will be responsible for this debt because of co-signing this loan. If my wife defaults on this loan either before or after our divorce am I responsible for this debt?

Asked on March 6, 2011 under Family Law, Minnesota

Answers:

M.D., Member, California and New York Bar / FreeAdvice Contributing Attorney

Answered 10 years ago | Contributor

As a general rule - one spouse is not obligated to pay the bills of the other spouse.  There are however exceptions. The first would be if you live in a community property state, then you would typically bear responsibility for your spouse's debt (fortunately for you MN is not such a state). The second exception would be if you signed or in some other way agreed to be legally bound for re-payment on the debt (no problem here since the loan is solely in your wife's and her nehpew's names). The last exception falls under something called the "doctrine of necessities". While many states no longer follow it, in the states that still do, one spouse is liable for the "necessary" expenses incurred by the other spouse during marriage (even if your state follows this doctrine, co-signing a loan for someone else would not be deemed to be a "necessary” expense of the household).  Consequently, based on he facts presented, you would appear to bear no responsibility for repayment on this loan.

Note:  To the extent that you have joint assets, then those assets would be at risk. For example, a house or joint bank account (at least to the extent not exempted under law).  At this point you should consult directly with an attorney in your area.


IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although AttorneyPages.com has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.

Get Legal Help Today

Find the right lawyer for your legal issue.

 Secured with SHA-256 Encryption