By Chris Tobias
Divorce can be exhausting on your emotions and affect your life more than you anticipated. If bankruptcy is heaped on top of it, it can become even more worrying. Divorce is one of the most common reasons cited as the leading cause for a bankruptcy filing.
If you believe that you and your partner are headed for divorce, and both have a lot of debt, it might be a good idea to decide to file for bankruptcy before you begin to file for divorce. This will pave the way for the divorce to proceed much more quickly because it will allow you to get rid of some of your debt and clear the way for a clean break. If you can file for bankruptcy, you can have a better idea of dealing with the debts that do remain between the two of you. It will also mean that if your ex files for bankruptcy later on down the road, you can be protected because you will take care of your debts before the divorce.
How It Works
The way it works is relatively simple. When one or both of the spouses file for bankruptcy, all of the property they have shared will become a part of the estate and then be available to pay for the debts. This will also mean that you have been granted an automatic stay, which means that the creditors can’t hound you for money. Remember that this stay does not prevent you from getting spouse or child support from your ex. The next thing that will happen is that the bankruptcy court will decide what shared property is exempt from bankruptcy, meaning that it cannot be sold to pay for your debts. Then, the divorce court can divide that property between you and your ex-spouse.
If you are trying to negotiate property settlements and going through bankruptcy, you will be dealing with very complicated issues. Some of the debts related to a property settlement might not be wiped out during the bankruptcy, so you will still need to pay them. However, these debts can be wiped out if you can show that you can’t pay the debt and still take care of yourself or your children, or that if you wipe out the debt, it is going to be better for you than the harm that would be done to the people that you owe by not paying it. This means that if you think your spouse is going to consider filing for bankruptcy after the divorce is final, you need to make sure that your finances are squared away so that you aren’t going to be faced with any more debts.
Divorce and bankruptcy present an opportunity for a fresh start for you, your ex, and your families. By understanding both, you can make a more informed decision and emerge stronger than ever. However, both of these processes can be extremely detailed and complex and should not be handled without experienced divorce and bankruptcy lawyers on your side. Remember, it’s always best to consult with a lawyer that can advise you through the process and get the result you deserve.
If you are thinking about divorce, bankruptcy, or both, the Law Firm of Figeroux & Associates is experienced and knowledgeable in both matters. Get a free case evaluation by calling 855-768-8845 or visiting www.askthelawyer.us
Remember, the lawyer you hire does make a difference!