3 Tips for When Bankruptcy is Paired with Divorce
One of the toughest aspects of a divorce is the emotional toll it takes on the couple. However, there are also a few other areas in which divorce takes a toll. When it comes to logistics, there are countless money-related issues that must be dealt with when a married couple splits up. Unfortunately, these money issues can sometimes lead to the need to file for chapter 7 or chapter 13 bankruptcy, which comes with a whole other set of considerations. If you ever find yourself in this position, remember these 3 things:
Should you file before or after divorce?
Well, it depends. In many cases, it makes more sense to file for bankruptcy while you and your spouse are still married. That way, debts will be forgiven, and the two of you can have a fresh start once the divorce is finalized. Just keep in mind that filing for bankruptcy jointly will require you and your spouse to work together; consider whether the two of you will be able to do this effectively. On the other hand, in some situations, one spouse makes too much money to file for chapter 7 bankruptcy. In this case, the other spouse would have to file for bankruptcy after the divorce.
The division of your assets will have an impact.
Understand that if you file for bankruptcy post-divorce, the way that your assets were divided up will likely affect bankruptcy. Yours and your ex’s assets in the property settlement agreement are what will indicate which assets you will exempt from your bankruptcy estate. This is important to consider when deciding whether and at what point to file for bankruptcy.
How does bankruptcy affect child support?
First things first, spousal support and child support are not dischargeable in bankruptcy. What you can do is cure support payments that are past-due if you file for chapter 13 bankruptcy. Also, keep in mind that if you have obtained other unsecured debt discharged in bankruptcy, your child support payments may become more affordable.
One last piece of advice: It is always wise to hire a reputable bankruptcy lawyer when situations like this arise. Do not try to do it by yourself when there is good help available!
Lewis and Jurnovoy is a local law office serving the Florida Panhandle. We specialize in bankruptcy law, including Chapter 7 and Chapter 13 bankruptcy. We will work to achieve the best financial remedy for your outstanding debts.
Lewis & Jurnovoy PCB
2714 West 15th St
Panama City, FL 32401
(850) 913-9110
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