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Seems like it would make sense to have her declare bankruptcy before you get married also (???)
thats the idea...
When you declare i thought it was ALL of your debts rolled into being bankrupt. We could easily pay off the cable/dental and do the hospital. We're trying to look at all of our options.
(I'd love to know the answers *assuming we live in california* to the questions below)
A.) if she filed for bankruptcy would that actually eliminate the medical/dental/cable debts completely?
B.) once filed for bankruptcy does that effect my individual credit once we're married?
C.) How long/bad of an effect would her bankruptcy effect our joint credit.
D.) Does my good credit effect her bad credit at some point, when and how much?
and lastly
E.) If you have a creditor, who's effecting your credit through a false/illegitimate charge, can you dispute it and remove it from your record? Assuming they didnt outright steal your identity, but if say an auto shop tried to charge you a fee you never agreed to pay, then they just add it to your bill, and you pay all BUT that portion, and they come after you for it, can you dispute this? Seems like I could run a dog walking biz, and say 'Well we had to clean up fido's poo, and we already had your billing info, so that's an extra 100 bux, now pay us or we'll ruin your credit score."
Assuming your income is high? There is a reason you don't see a long of single parent working households anymore, a kid is expensive.
As others have pointed out, anything happens to you, she's going out on the streets if you don't address her debts. They're only going to grow.
One of the largest reasons you don't see a single income family isn't the cost of kids but rather lifestyle choices. Single income family was much more achievable when the average family had a 1200 sqft house, 1 car, 1 tv, 12 tv channels, 1 phone, possibly one extra curricular activity per child etc. Now the avg is 2400 sqft house, at least two cars, tv in every room, 200 channels on tv, everyone has cell phones with data plans, home internet/computer, kids in multiple activities etc
I believe in taking care of my debts which I do in full every month. However if they're not my technically my debts than I don't see how I would have a obligation to pay and from my research the individual debts from before the marriage would not combine.
We have been together since high school and I fully agree with what you said. We have discussed this alot recently and she has been able to stick to a budget. We have agreed that I would just add her as an authorized user to one of my cards with a limit that would allow for household expenses and a reasonable amount for shopping.
My thing right now is if she has no official income is there anyway it would affect us as a family.
Yes. Defaulting on student loans doesn't ever go away. And you don't just blow them off - they come after you and levy a lot of fees and then charge you interest on it, so that by defaulting you can end up with three times the debt. And she can't ignore it forever, because defaulting on student loans can have numerous consequences, all of which WILL eventually affect your family. Here is a list from studentaid.gov:
The entire unpaid balance of your loan and any interest is immediately due and payable.
You lose eligibility for deferment, forbearance, and repayment plans.
You lose eligibility for additional federal student aid.
The loan will be reported as delinquent to credit bureaus, damaging your credit rating. This will affect your ability to buy a car or house or to get a credit card.
Your federal and state taxes may be withheld through a tax offset. This means that the Internal Revenue Service can take your federal and state tax refund to collect any of your defaulted student loan debt.
Your student loan debt will increase because of the late fees, additional interest, court costs, collection fees, attorney’s fees, and any other costs associated with the collection process.
Your employer (at the request of the federal government) can withhold money from your pay and send the money to the government. This process is called wage garnishment.
The loan holder can take legal action against you, and you may not be able to purchase or sell assets such as real estate.
Federal employees face the possibility of having 15% of their disposable pay offset by their employer toward repayment of their loan through Federal Salary Offset.
It will take years to reestablish your credit and recover from default.
Your wife may one day need to work, baby or not, and that means she'll need a job. Aside from wage garnishment, she may not be able to get certain jobs. It's incredibly naive - and selfish - for you to marry her and let her loans default while she stays home with your child. Also, you may run into trouble if you want to borrow money for your child's education. Of course, if you ever divorce and she's on her own, she's royally screwed. Depending on divorce laws, you could also be held liable for that debt. Instead of defaulting she needs to look at her repayment options. Hopefully she has govt loans and can get on an income based repayment plan. If you can't do that and at least pay the interest, then try to get a forbearance or deferment, but remember that interest is accruing and will be capitalized. Trying to ignore this debt only makes it worse - it's what I tried to do and now I'm paying my entire salary to loans and will for the next 10 years. If I'd gotten serious about repayment earlier it would be mostly paid off by now, and would never have gotten as high as it did. And perhaps instead of staying home and having a baby, she should work for a few years to pay down some of that debt. To be honest, you say you have a history of sound financial decisions, but your plans say otherwise.
when you marry someone their debts and obligations WILL affect you no matter what the law says about it... in practice it will affect you.
Say she owes student loans, yes, legally you are may not liable but this is just a technicality - in practice you will be liable.
If she cannot work and has to stay home then who do you think is going to wind up paying for it? YOU!!! In a community property state half your income is considered HER income and that can be attached to debts incurred PRIOR to the marriage. Student loan is a government debt and trust me the government will collect from her share of the community assets.
As to one spouse's separate debt, such as one spouse's child support obligation from a prior relationship, or a debt in one spouse's name only where the spouse hid the fact that he or she was married, a creditor can go after only that spouse's half of the community property to repay the debt.
Bad credit only lasts 7 years and SOLs are usually no more than 6. I realize this is old. My advice would be, dont do it unless you can pay all her debts and you get enough in return from the relationship to make it worth it. Maybe avoid "legal" marriage too. Contest her old debts. She needs to agree to let you help you clean up her credit. Also you will suffer some of the bad of bad credit (which is not as bad as people make it out here). You can get places to live and you can put big purchases in your own name. Get a big life insurance policy on yourself so she wont die if you do. If she wont let you own her credit and fix it, you will have a problem because her consequences will become yours so you have a vested interest in her finances but love is love. I want to puke when people attach a credit score to it
Also there is some misinformation. In a community property state student loans usually only become the spouses issue if they were incurred during the marriage and proof can be made the marital community benefited. For example, wife has loans from degree that she earned a lot of money for the marriage, used proceeds from loan to buy husband car. If her degree is unfinished or unused, it generally did not benefit the marital community. If the debt was before marriage, it almost certainly is not community debt. Though a pre nup might not hurt and would solve this,. I know its an ancient thread. SOURCE: Divorced in community property state from wife with a crap ton of student loan debt and an unfinished worthless degree.
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