Should You File for Bankruptcy and Divorce?

/Should You File for Bankruptcy and Divorce?

Should You File for Bankruptcy and Divorce?

2018-03-06T12:03:44+00:00January 17th, 2018|

Here at Grunyk Family Law, we are committed to helping each and every couple that comes to us with questions about divorce determine what the best options are for them and their family.  Helping men and women achieve their family law goals while maintaining their dignity and self-respect is the cornerstone of our practice. We are dedicated to achieving positive outcomes in an amicable fashion no matter what the cause of the divorce may be.

Causes for Divorces Today

Money is among the biggest sources of stress and tension in many relationships. And it is also one of the leading reasons why a couple feels a divorce is necessary.  Each spouse usually believes that the other party is the main reason why the marriage is failing and why there are so many financial woes. This belief may or may not be true and regardless of the validity of those beliefs, it cannot be denied that more couples are divorced due in some part to financial problems than ever before. Many couples think that getting a divorce is an easy ticket out of their financial situation and is a way to avoid the debts and woes that are bogging them down. This, however, is not the case at all and many debts and financial obligations will still follow you even after a divorce has been finalized. One solution many couples are considering is the options of filing for both bankruptcy and divorce.

Shared Responsibility for Debts

It may come as a surprise, but both spouses share responsibility for any and all of the debts that they have incurred during the years that they have been married. And while it is true that the divorce settlement will divvy the debt up and designate who is responsible for what, the divorce settlement does not bind the creditor from collecting the debt, even if that means going after the other party. This means if your ex-spouse fails to pay their share of the debt, you may find yourself getting calls and letters from the creditor demanding you pay their debt. For example, if you both have $10,000 in shared debt and the judge as determined an equal split, you both need to pay back $5,000; if your spouse doesn’t pay their share you will be responsible for paying your $5,000 and if the creditor still wants the rest they can try and make you pay the rest as well. This can put you in a very big financial bind that is difficult to get out of without a lot of work.

Filing For Bankruptcy and Divorce

It is often in the best interest of everyone involved if you and your spouse decide to file for bankruptcy before you go through with the divorce. It is possible to file for bankruptcy and divorce and it is often in your best interest to do just that. If your spouse files for bankruptcy after the divorce and they are approved, then you become the one responsible for their debts and this could push you into bankruptcy as well. Filing for bankruptcy before the divorce proceeds ensure you both are on an even playing field financially so no one party is more heavily affected by the debt than the other. This way you will know where you are financially then it comes time to divide the property and assets you share. You and your spouse need to be able to work together on a certain level to accomplish this so if you are to a point where the basic meetings of the divorce process are painful and difficult then this may not be a viable choice for you and you may have to proceed without the bankruptcy being filed ahead of time.  It is important to remember the risk that is involved- the prospect of having bill collectors coming after you for the debts your ex was supposed to pay can be unsettling. There are ways to protect yourself from your ex-spouse filing bankruptcy after the divorce as a means of shifting their debt to your shoulders so be sure you speak to your divorce attorney about these provisions.  They can help you determine if filing for bankruptcy and divorce is the best option for your unique situation and needs.

Child Support When Bankruptcy is Declared

Child support payments and other court ordered payments that are made to your ex for things like caring for minors that money is not affected by a declaration of bankruptcy and is not a way to avoid court-ordered payments. These aren’t dischargeable in a bankruptcy proceeding, and anyone ordered to make these payments will still be liable for them, even if he or she does file for bankruptcy. This is done in order to protect the quality of life for any children who are affected by the divorce. For example, a couple is divorcing and has one minor child who will be living with the mother. The judge ordered the father to pay $1000 a month in child support payments to help ensure his child still have everything they need. If he files for a divorce in an attempt to get out of his share of debt responsibility, his child support payments still remain in effect and he will still be legally responsible for those payment every month. It is important to understand the connection between bankruptcy and divorce and to know what bankruptcy can and cannot do for your financial obligations.

Legal Help For Your Bankruptcy and Divorce Needs

Working with an experienced family law attorney will help you get through the process and begin your new life. We are here to help you do exactly that. Contact us today and let us help you through every step of the process. No matter how involved or messy your divorce is shaping up to be or how simple and straightforward it seems to be falling into place, you can benefit from legal assistance. Our team has years of experience working with a range of divorce cases and can help you along every step of the way. Whether you are still determining if a divorce is right for you or you have questions about how bankruptcy and divorce can work to your advantage, our team is here for you. Give us a call today! We look forward to helping you resolve your family law issues in a dignified manner. We truly believe that every client and every case is unique. How the law is applied varies with each case based on what is right for the people involved. We never feel like we have won a case unless a client has achieved their goals. We aim to work toward achieving these goals for our clients all while maintaining their privacy, dignity and control.

To discuss your needs with a dedicated Illinois attorney, please contact us at Phone: 630-428-3300 | Fax: 630-428-3313 or you can come see us today at 200 E. 5th Avenue, Suite 125, Naperville, IL 60563.

Call Us