Bankruptcy and Divorce: Which comes First?

If you contemplate filing for both divorce and bankruptcy, the timing could be crucial. For the most part, the question of divorce and bankruptcy and what ought to be considered first can be a perplexing one.

One chapter after another

According to Macon, GA divorce lawyers, bankruptcy ought to come first, followed by divorce. If you are filing for bankruptcy while the divorce process is on, it will delay the division of assets as well as liabilities until the process of bankruptcy is completed. Therefore, there is no way accomplish both simultaneously.

It does not matter if you have the best legal help across the land. There are certain things that no one person can change and even if they could, it would take months, if not more than a year. Regardless, you need to be working with a divorce lawyer who knows the lay of the land. This process can be quickly started by pressing this button.

In fact, bankruptcy manages any debts linked to an individual’s name and/or social security number. Thus, it can influence how debts are handled in your divorce. Besides, bankruptcy courts will treat your income in a different way, depending on the fact that whether you remain married, or separated when filing the case.

Filing bankruptcy first

According to Georgia divorce attorneys, if you are on good terms with your spouse, consider bankruptcy before your divorce. If you file jointly, every debt will be assessed under a single bankruptcy case. By filing for bankruptcy, you can wipe clean your joint debts, and even potentially increase the exemption amount. In this way, you stand to gain in case one spouse earns all the money, and will enhance the scope for qualifying for a Chapter 7.

Bankruptcy can also cancel contracts that neither of you want, such as car loans that are too expensive, nor mortgages on your house that are fully under water.

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When you qualify for a Chapter 7 bankruptcy, you ought to complete it in around 90 days. As a result, both spouses can do away with any unsecured debt. But don’t forget one thing:  if both of you file for a Chapter 13 bankruptcy, the two of you are accountable for any repayment plan. Further, you cannot divide your assets by sale. When the bankruptcy process is over your divorce will proceed without any more delays.

Filing for divorce first

In the opinion of Macon, Georgia divorce lawyers, you could file for divorce first if your joint income is so sufficient enough for it not to qualify for Chapter 7 bankruptcy. If your income is significantly less than your spouse, you may be able to get rid of any debt in your name and qualify for a Chapter 7 without a Chapter 13 payment plan. In some cases, it may be possible for both spouses to separately qualify for Chapter 7 bankruptcy following a divorce if it was not possible to do so jointly.

By divorcing first, you could also benefit when it comes to support since it will affect the way your bankruptcy case proceeds. It will help to know the amount of support before the bankruptcy. After all, what is worse than being compelled to have a bankruptcy repayment plan that is based on income, if you don’t have access to it?

Filing for bankruptcy first or divorce needs careful consideration since there are several factors involved. If you are confused about it, all you have to do is consult an astute Georgia divorce lawyer.