Filing Bankruptcy During Divorce Proceedings
Divorce is one of the leading reasons that people file for bankruptcy.
At the Law Office of Michael A. Ziegler, bankruptcy attorney Clearwater, there are cases that we work with frequently on this level.
It’s important to know before you take this action exactly what the logistics and consequences are.
Expenses can be overwhelming when you get a divorce. It’s a stressful time, and you are trying to create a new arrangement while handling any existing household expenses.
Bankruptcy Attorney Clearwater Gives Sound Advice
One of the things you need to consider before filing for bankruptcy is whether to file with or without your spouse.
If you are not yet divorced and would like to file for bankruptcy, you can consider a simple bankruptcy filed jointly, or for the individual who makes less money if the outstanding debt is in their name.
This bankruptcy will take care of the contracts that will affect you and your spouse financially, and is usually recommended if you and your spouse make a combined income, or one person makes the money.
If you qualify to settle these debts through bankruptcy, you will most likely be able to complete the process in a few months.
This means you can then file for divorce without the financial burdens that may cause strife or lengthy negotiations.
This kind of bankruptcy is referred to as Chapter 7. For more advanced bankruptcy filing, your attorney will need to evaluate these facts on a case by case basis and give full recommendations.
In the case of a Chapter 7 where the joint income is too high to qualify for bankruptcy, you may wish to file after the divorce.
This means that you will be solely responsible for the debt, and the bankruptcy will help you alleviate that debt.
This can save your spouse from having to pay for your debt after the divorce, or help you if your debt is not determined in the divorce to be obligated toward your spouse.
The important thing to remember about bankruptcy and divorce is that filing for bankruptcy will not alleviate you of your spousal obligations that were determined in the divorce settlement.
This includes alimony and child support. You can, however, get rid of or manage some of the debts that were incurred during the marriage, like credit card debt or medical debt.
Divorce and bankruptcy have a complicated relationship. Debtors are not in the business of sorting through your debts and determining who owes- remember that they will bill whoever they have on record as the responsible party.
If you file for bankruptcy without first finding out the intricate details of what that will mean for you in a divorce, you could end up planning poorly or being responsible for debts you were no longer aware you owed.
If you are filing or have filed for divorce, and your bills are causing you to consider filing for bankruptcy, you should seek legal counsel right away.
At the Law Office of Michael A. Ziegler, bankruptcy attorney Clearwater, we are here to help you understand your financial obligations and take legal action to create a more sustainable lifestyle for you and your family.