Attorney Michael S. Georg is the partner/owner of Debt Advisors Law Offices. Mike grew up in Wisconsin and has helped thousands of Wisconsinites eliminate millions in debt using Chapter 7 and Chapter 13 bankruptcy of the bankruptcy code.
Filing for bankruptcy is never easy, and the process becomes even more complicated when you share ownership of property with a spouse, family member, or business partner. Homes, vehicles, and other assets that are jointly owned raise important questions: What happens to my share? Could my co-owner be affected?
For Wisconsin residents, the answers depend on the type of joint ownership, state community property laws, and whether you file Chapter 7 or Chapter 13. Understanding these factors is crucial to protecting your rights and avoiding unexpected consequences.
This guide takes a closer look at how different forms of joint ownership are treated in bankruptcy, what risks and protections exist, and practical steps you can take to manage jointly owned property during and after the process.
When you file for bankruptcy, any property you own jointly with someone else—like a spouse, family member, or business partner can be affected. The way this property is handled depends largely on the type of ownership:
These distinctions directly affect what might be at risk and how proceedings unfold, making it essential to understand the structure of your ownership.
How bankruptcy affects jointly owned property depends on which chapter you file. Each type has different rules that influence whether assets are liquidated or protected.
In Chapter 7, some non-exempt assets may be sold to repay creditors. For jointly owned property, only the filing individual’s share is considered part of the bankruptcy estate. While a trustee could seek a sale, the co-owner’s portion remains protected.
Chapter 13 works differently because it focuses on repayment through a court-approved plan rather than liquidation. This structure generally allows individuals to keep jointly owned assets while catching up on debts over time, providing more predictability for co-owners.
Bankruptcy also impacts joint debts and financial obligations shared with someone else.
This is why many people seek guidance from a Wisconsin bankruptcy attorney when joint debts are involved.
Wisconsin is a community property state. This means that most assets acquired during marriage—income, real estate, personal property—are treated as jointly owned, even if only one spouse files.
Understanding how community property rules apply to your situation is critical for married couples considering bankruptcy.
Dealing with jointly owned property requires careful coordination:
Legal advice ensures that property management decisions comply with bankruptcy law while protecting co-owners.
Once bankruptcy ends, the focus shifts to recovery and long-term stability. One of the first priorities is rebuilding credit. Using secured credit cards, small installment loans, and consistently making on-time payments can gradually improve your score, often within 12 to 24 months.
It’s also important to manage joint assets carefully. Take time to clarify ownership shares and responsibilities with co-owners, whether it’s a home, vehicle, or other property. This helps prevent misunderstandings and avoids disputes that could cause future financial setbacks.
Finally, creating a realistic budget that accounts for property-related expenses is essential. Tracking income and shared obligations not only protects your finances but also safeguards the interests of everyone involved in the jointly owned property.
Bankruptcy involving jointly owned property can feel overwhelming, but it doesn’t have to derail your future. By understanding how different ownership types, Wisconsin’s community property laws, and Chapter 7 versus Chapter 13 rules apply, you can make smarter decisions for yourself and your co-owners.
If you’re navigating these issues, guidance from an experienced Wisconsin bankruptcy attorney can help protect your property rights and clarify the best path forward. At Debt Advisors Law Offices, our team has decades of experience helping residents across Milwaukee and throughout the state resolve debt while safeguarding essential assets.
Schedule a free consultation today to discuss your situation and take the first step toward financial relief and a more secure future.
Learn about bankruptcy protections, types of bankruptcy, how to get started, what to expect, and who to trust. Filing bankruptcy is the ONLY way to completely eliminate debt. If bankruptcy is right for you, it offers powerful protections that cannot be achieved through alternative solutions such as hardship relief, loans, or debt settlement.
