Money problems almost always lead to relationship problems. In fact, many divorces come about because of the stress that money places on the marital relationship. Moreover, divorce is a top cause of financial ruin for many people; they find themselves with few assets and a mountain of debt. Remember, you can divorce your spouse, but you can’t divorce the debts that the two of you incur during the course of your marital life, and sometimes bankruptcy is the best course of action to consider. If you go into the divorce with debts to divide up, a creditor can still come after you personally if your ex-spouse fails to pay the debts assigned to him/her in the divorce judgment and ultimately files bankruptcy. Filing for bankruptcy while you’re still married also lets you both see where you stand when the time comes to divvy up your property.
There are several considerations to make when you are deciding whether to go ahead and get divorced or take care of your bankruptcy first.
Type of Bankruptcy
A determining factor in deciding to file bankruptcy before or after your divorce is the type of bankruptcy you plan to file. Chapter 7 bankruptcy is a simple bankruptcy type that requires just a few months to complete. You can file a joint bankruptcy with your spouse, have your debts discharged, and then proceed with your divorce. If you file Chapter 13 bankruptcy, however, the process is long and drawn out, sometimes requiring up to five years to complete, which can complicate your divorce plans. However, if you file together, your combined incomes may be too high to file for Chapter 7 protection, which may necessitate waiting until after you divorce in order to file bankruptcy.
You should also take your marital assets into consideration prior to filing bankruptcy before you get divorced. Review your assets with your Salt Lake City divorce attorney to determine how your assets are protected if you file bankruptcy jointly with your spouse, including any homes, vehicles and other large assets. Your attorney can best advise you on whether waiting to file or filing now is your best option.
Finally, consider the dynamics between you and your spouse. If you are on peaceful terms, filing bankruptcy prior to divorce may be a good plan. However, if your spouse is hostile, bankruptcy may only serve to make your situation worse. Keep in mind that a joint bankruptcy will require you to work with your spouse to gather documents and to make court appearances. You may have other remedies to prevent yourself from being stuck holding the bag if your divorce files for bankruptcy post-divorce and creditors pursue you. For example, your divorce attorney may suggest that you place a lien on your ex-spouse’s property until the debt in question is paid in full.
Contact The Ault Firm to discuss the particulars of your case prior to making a decision on which to file first – bankruptcy or divorce. Our Salt Lake City divorce attorney is available for consultations to discuss the particulars of your case. Gary identification. Contact the Salt Lake City family law attorney with The Ault Firm to discuss your adoption plans and determine if adopting internationally makes sense for your family.