My husband is going to file ch. 7 bankruptcy. I have decided not to file with him because I have been working on my credit and have got it pretty good and I dont see the need to file. We don't have any debt together as far as credit cards or anything except for a student loan through sallie mae. That is on both of our credit reports. I went to the school and he had to sign the loan papers. How will this affect my report and can we rehab this loan before he goes into bankruptcy? I dont even know if we can file it in the bankruptcy because I didnt think you could do student loans. What would be your suggestions as to what to do as far as to keep my credit still clean?

Is the loan federally-guaranteed or not? Sallie Mae has both federal loans and private loans. Since your husband had to sign for it, it sounds like it might have been credit-based, which means that it wasn't a federal loan (they don't look at credit). Is the student loan current? Since it's showing on your report, too, and you're saying that your report is clean, I'm assuming that it is. If that's the case, then there's no need (or ability, for that matter) to rehab the loan. Rehabbing student loans only applies to federally-backed student loans that have gone into default. I'm assuming that your husband was a co-signer on your loan and that you also signed the papers and that's why it's on both of your reports?

Your suspicion is correct -- SLs cannot be included in BK, except in a few EXTREMELY limited circumstances (extreme financial hardship, but that's nearly impossible to show, especially since only your husband is filing and you're not). If the loan is not included in the bankruptcy, then I don't believe it will have any impact on your report at all. You may want to ask a BK lawyer to confirm (even if you're just considering filing, you may want to meet with one; most do an initial consultation for free). If he does file, I would check your report fairly regularly, though, to make sure that it doesn't "accidentally" report as "included in BK" on your report, even though it wasn't.

I hope this helps! Good luck!!

I'm sorry I should have told you the loan is in default. We never paid the loan off. I am not sure if it is a government backed loan, but going by your information it was based on our credit and that is why he had to cosign, because my credit was not good enough. We talked to the lawyer yesterday and he didnt say much about how it would affect my report if I dont file. If it does show up as included in bankrupt on my report, then if I try to get credit later on the future will they think I filed bankruptcy? Wont I might as well go ahead and file if it is going to say included in bankrupt on one? Im sorry so many questions but I appreciate the help!!

No problem at all -- that's why everyone is here; we're all confused, or were at one point!! If the loan is not federally-backed, then it's not eligible for rehab. You can check the status of your loans (what type, where held, etc.) at the DOE's student loan information page -- http://www.nslds.ed.gov/ . You'll need a PIN, but you can request one via e-mail and I think it only took about a day or so to get it. If your loan isn't listed there, then it isn't a federal loan and it isn't eligible for rehab. After you've done that, I would contact SM and talk about repayment options (and rehab if it turns out it is eligible), especially if it's a federal loan. SLs are very different than other types of debt and they can (and do!!) come after you forever on this, but they do respond much better if it's you contacting them rather than the other way around. How old is the loan? If it's not a federal loan, then it's subject to the same statute of limitations as any other bank loan (which varies by state). Federal SLs don't have one at all.

If it is reported as IIB (included in bankruptcy) on your report, but it isn't included in your husband's BK, then I would dispute that with the reporting agencies (and SM, if necessary). That would be incorrectly reporting since it's not IIB. I wasn't very clear (at all!), but that's what I meant when I said you should diligently check your reports after that. Not that it would have to stay, but that you should check it so that if it does show up, you can dispute it right away. The decision is obviously completely yours to make, but if that's the only reason you're even contemplating BK yourself (as opposed to your husband), I wouldn't do it.

Good luck!!

thanks so much for the help!! That was helpful information.

You might want to double check with your lawyer, but when my neighbors were doing the same thing, they were told that he could do a Chapter 13 without it affecting her credit, but a Chapter 7 would show on her's also. I didn't understand why there would be a difference. They ended up not filing as he was out of work and unemployment doesn't count as an income on Chapter 13 and she didn't want to Chapter 7 on her otherwise perfect credit.

Just something to double check on in your state.

Lost has an excellent point -- it depends on whether your state is a community property state and how it handles specific debts for married couples. That's a state law issue, though, so it's going to vary by state and you'll need to check with your attorney on that.

Lost -- sounds like what you're saying is that the BK would have ended up on the wife's CR, regardless of whether or not she had ANY accounts the same as his or am I misreading that (certainly likely!!)? That sux!!

I am in Oklahoma and when we asked the lawyer he said that I could take my chance that if my husband filed and even though my name was not on the credit cards or anything he said it still benefitted the household (so if we bought a washer on my husbands sears card, than the household benefitted from it, and I was living in the household) so in any case if the creditors wanted to, they could come after me for the debt. He said I could take my chance that very seldom do they do that. I was just wondering what ya'll thought about this lawyers information. I havent ever dealt with any lawyers and this is new to me.