Silverberg Business Bankruptcy Law

Divorce and Bankruptcy

Divorce often causes financial stress. Financial stress can challenge a relationship. So, unfortunately, many personal bankruptcy cases arise in the shadow of a divorce. Questions arise as to the impact of bankruptcy on child support and maintenance. And parties facing divorce while undergoing financial hardship often have to make strategic decisions as to when or if to file bankruptcy.

Should You File for Divorce or Bankruptcy First?

Should you file for divorce or bankruptcy first? This is a common question asked as couples face these tumultuous life events. It is important to understand that bankruptcy is specific to you personally.  It does not discharge your spouse’s obligations Your bankruptcy does not impact your spouse’s financial situation or their credit report. You do not need spousal consent to file bankruptcy unless you are filing jointly. Bankruptcy can be filed prior to a divorce, however, it can create a great deal of legally complex issues that affect both you and your spouse, and any decision should be carefully discussed with both your divorce attorney and a bankruptcy lawyer.

Filing Bankruptcy Jointly Before Divorce

If you decide to file bankruptcy jointly it can be more efficient and also dismiss and discharge the debt of both spouses, meaning that it will not be debt they need to divide in the divorce proceeding.  The cost of a joint bankruptcy is also less to file than it is separately.  If couples feel a need to file for bankruptcy and are able to do so amicably before the divorce process, it can remove a large portion of debt that both would otherwise owe. Additionally, because the issue of debt has been decided before the divorce through bankruptcy, it can save both parties a great deal of money on attorneys, as this issue will not be contested and is already decided.

Filing Bankruptcy in the Middle of a Divorce

If a spouse decides to file for bankruptcy in the middle of a divorce case, the divorce proceeding should be delayed while the bankruptcy case is pending as the assets and liabilities of the filing spouse are likely going to be significantly impacted by the outcome of the bankruptcy case. Ultimately, consulting with an experienced bankruptcy attorney can help you understand what options are best for your unique situation.

Can a Spouse Escape Paying Child Support or Alimony by Declaring Bankruptcy?

If an ex-spouse decides to file bankruptcy, any family support, child support or alimony will be considered non-dischargeable by the Bankruptcy Code. This means that under all conditions, child support and alimony payments will continue if the other party files bankruptcy. In fact, the automatic stay (which stops all creditors, foreclosures, garnishments, etc.) does not apply at all to child support or alimony. These types of debts and obligations are considered a priority under the law, and will always be required to be paid, under Section 523(a)(5) of the Bankruptcy Code.

Contact an Experienced Bankruptcy Attorney

If you find yourself attempting to decide whether to file for bankruptcy, you should know your legal options. Knowing which options to choose can literally change the course of your financial future. Before you file for Chapter 7 or Chapter 13 bankruptcy, serious consideration should be given to discussing your situation with an experienced bankruptcy attorney to understand your rights and options. Contact the bankruptcy attorneys at Law Offices of Jay Silverberg at 212-687-7000 or online for a free consultation today. 

Speak to our experienced attorney about your case; and we’ll provide you with the best solution possible.

At Law Offices of Jay Silverberg our team will analyze your case and determine that whether bankruptcy is the right option for you. If yes, then we will handle every aspect of your legal process, start to finish.

We will provide you with:

  • Professional Assistance
  • Strong Legal Representation
  • Quality Guidance
  • Attention

Which will help you make the right choice, and get out of debt smoothly, and fast.


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