No one is surprised by the fact that a single person can file for bankruptcy. It is also common knowledge that a married couple that is experiencing financial hardship can file bankruptcy. However, citizens of New Mexico may not be aware they can file for bankruptcy themselves without involving their spouses in the process.
What Is Community Property?
Community property includes any property that is accumulated during, which automatically belongs to both individuals. However, it does not include property that was bought or inherited before the marriage.
The concept of community property isn’t enforced in most states. New Mexico is one of only 10 states in the United States that recognizes the concept of community property. This greatly impacts the way that items in an estate are handled during the bankruptcy process.
The Concept of Community Debt
When it comes to debt, one of the largest misconceptions is that the debt of one person automatically becomes the debt of his or her partner. Quite simply, this is a myth. Any debt that is accrued by one individual in the marriage is the legal responsibility of that person and that person only.
What It All Means
Ultimately, even in a community property state like New Mexico, a person can file for bankruptcy without his or her spouse’s consent. While this can create a potentially volatile situation, there is no legal recourse that can prevent an individual from filing for bankruptcy protection.
Anyone who is considering filing for bankruptcy is encouraged to speak to an attorney familiar with bankruptcy law. A lawyer can review his or her clients’ assets, delve deep into their financial records and come up with the best course of action for his or her clients to take.
