Going through a divorce and bankruptcy at the same time can be overwhelming. These may be two of the most stressful financial and emotional experiences that one can go through.
When navigating these waters, it is important to know how to handle these ordeals simultaneously before making any serious decisions.
While it may feel like a unique experience to you, remember that others have gone through the same issues and have learned some important information about navigating divorce and bankruptcy at the same time.
Is it wise to file for both divorce and bankruptcy? With so much paperwork, time, and overall bureaucracy involved in both situations, it is unlikely that they can actually happen simultaneously.
If you do file at the same time, it is likely that the divorce case will take priority over the bankruptcy case. Once the court decides who receives what assets and debts from the divorce, then the bankruptcy case can proceed.
Because of this, you may want to simply wait until the divorce is final before filing for bankruptcy.
Regardless, working with an experienced bankruptcy lawyer will help you navigate what to do.
Should you file for divorce or bankruptcy first? There are several things to consider when making this choice, such as how much debt you have, the types of debt, how much property you have, and what filing option you want to choose.
Some couples choose to jointly file for bankruptcy before their divorce because it is an efficient way to proceed with the bankruptcy.
Another advantage of filing before a divorce is that marital debts may be wiped out instead of being included with the bankruptcy claim.
Filing for bankruptcy before the divorce can decrease the amount of time and fees spent on the claim for both people. However, it will require some cooperation between them!
On the other hand, some may choose to file for divorce first. The main reason behind this choice is the type of bankruptcy the couple or individual chooses to file for.
The choice may be made to file for chapter 7 bankruptcy because that will wipe out certain types of debt completely and is a much shorter process compared to the chapter 13 bankruptcy option.
Filing for bankruptcy can have a negative impact on a person and bring down their credit score if they do not take control of their financial situation. The same can be said of the longer-term impacts of divorce.
With bankruptcy, filing can impact your eligibility for loans and credit cards. By adding divorce in the mix, which could involve you relying on your ex to pay off certain debts, your credit score could have even more of a hit.
You could have cosigned on a loan with them and still both be responsible for paying, even after the divorce and bankruptcy proceedings have been finalized.
The impacts on your score could also depend on what type of bankruptcy you file for. For example, chapter 13 requires that both parties are responsible for paying marital debts.
However, once the bankruptcy proceedings are complete, it is possible to begin raising your score almost immediately.
Filing for bankruptcy or divorce is not enjoyable for anyone. Combine the two and it can feel even more stressful!
To ensure you are navigating these situations as smoothly as possible, it is important that you connect with a bankruptcy lawyer and create a solid plan.
We have years of experience helping people choose the right filing option and helping them through every step of the way, ensuring the process is as straightforward and stress-free as possible.
It’s important to hire an experienced bankruptcy attorney when you’re considering filing for bankruptcy.
This is because there are many different types of bankruptcy. Only an experienced lawyer will know which one would work best for your specific situation.
It might seem like it makes sense to do this yourself, but the reality is that most people don’t have the time or patience to understand all of the details involved in each type of bankruptcy. That means they make mistakes by not choosing the right type, or by not filling out paperwork correctly. Both things could lead to delays in your case and ultimately hurt your chances of getting any debt relief at all.
This is not a journey to take lightly, but it is also not one to take alone. If you or your business need to file for bankruptcy, reach out to us today to start your journey with us.
If you want to learn more about the options you have, call The Jax Law Center for a free consultation.
Parker and DuFresne