Bankruptcy, before or after a divorce?
That is really all depending on what debt and finances look like, have both of you talked about divorce or bankruptcy? There are so many questions to that, but let me give you the best information possible on what to do.
If there is talk of a divorce in your marriage, if this is something that both of you have talked about openly, you know that there is going to be a divorce and there is a lot of debt, I am going to tell you that the information I have seen and read, it is cheaper to file a joint bankruptcy then separate and bankruptcy during divorce can get confusing and have many conflicts of where the debt is going, or even after a divorce. If you know there is a lot of debt that is being divided during the divorce and you are both going to have to file bankruptcy anyway's even after the divorce is finale, file together before you start the divorce, yes it takes longer, but in the long run can save you lots of money in the future.
It is different if you do not see the divorce coming and your ex files bankruptcy during the divorce without you knowing, we talked about a hold harmless clause that should be in your divorce order, especially if your ex has taken on the mortgage and any land payments. As we discussed before the hold harmless clause in divorce papers, will not allow your credit to go along with you having to make the payments.
So what happens if you both have not discussed a divorce; one of you did not see it coming; or the thought of bankruptcy before, but there is a lot of debt in the marriage; what happens to the property settlements during the divorce while bankruptcy has been filed at the same time? This can get extremely confusing. First off if you file bankruptcy on property settlements during a divorce those are considered non dischargeable, so what this means is that the person that has filed for bankruptcy during the divorce can not have those debts wiped away, many people think they can get everything off in bankruptcy, but during a divorce things will fall different, although if the person can show they can not take care of themselves at all, with the debt or, taking away the debt of the person filing will not do any harm to the former spouse and children in the marriage by not paying the debt. Another reason that if you both want the divorce and there is a lot of debt do bankruptcy before hand, and then get your divorce, this will save a lot of time, money, and heartache.
Remember when you are going through a bankruptcy in the middle of the divorce, everything becomes part of the bankruptcy estate and they may use property, land, and other items to pay off the debt in the marriage. This means you both may end up with nothing, why it is sometimes important to know before hand.