As you explore your debt relief options in Canada, you might be asking, “How will bankruptcy affect my spouse?” The good news is that your partner is NOT responsible for the legal debts you have incurred when you have acted alone. Individually contracted debt by one spouse does not obligate the other.
If however, both you and your partner’s names are on a credit card agreement or if there was anything such as a mortgage or loan agreement co-signed by your partner, then your partner is seen as a guarantor and is legally responsible for the debt. This will in turn affect their credit rating. In addition, when filing for bankruptcy in Canada, your trustee must include the income from the spouse in the calculations of family income and expenses. This information is used to determine what monies are available to pay the creditors. The Superintendent of Bankruptcy in Canada has established guidelines for how much, if any, of your income you may have to pay to your creditors. Your bankruptcy trustee will be fully aware of all the options available to you and will walk you through the process of understanding which option may be best for your unique situation.