In my sixteen years of experience as a bankruptcy attorney, I have seen many clients who have been forced to file either Chapter 13 or Chapter 7 because of a recent divorce. When the household income is cut in half but the household expenses remain the same, paying credit card debt is almost impossible.
I understand that some couples may be in such a heated situation that they both want the divorce to come as fast as possible. However, sometimes it makes sense to slow things down and to file bankruptcy before getting divorced.
Avoid Future Headaches
A common post-divorce example is that each spouse is ordered by a divorce judge to pay half of all joint debts. When one person gets into a situation where they can’t pay, the other person often hauls them back into divorce court for a contempt proceeding for not paying the joint debt. Usually the cause of one spouse not paying is a loss of job or new expenses from a new marriage/new family. Contempt proceedings in divorce court may get the nonpaying ex-spouse to come up with funds to avoid going to jail in the short term but the underlying situation does not change. Whatever the cause, the nonpaying ex-spouse cannot pay. This cycle continues until the person who has been paying their side of the debts can no longer afford to pay an attorney to keep hauling the other person into divorce court. After thousands of dollars and heartache, both end up filing bankruptcy.
Get a Fresh Start
Many times, it just makes sense to go ahead an wipe all of the debt so that both people can move on with their lives without having a continued string to their ex-spouse. In my office, it does not cost a dime extra for a married couple to file together. However, once the divorce takes place, two separate cases would have to be filed which means double the cost of what it would have been if there has been a joint case.
Couples who are under financial strain should consider bankruptcy before the divorce. It does not cost anything to meet with me and let me analyze your situation. Perhaps the removal of the financial strain might save the marriage?
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3. How much does it cost to file?