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Divorce and Bankruptcy: Where to Begin?

Many who have turned to bankruptcy have had to do so as a result of their divorce. But in some cases, if these people had gone through bankruptcy first, then both that legal process and the divorce would have been simpler. There are other situations, however, where it is still best to start with the divorce. Read below to learn how the order of these processes can significantly affect your financial future.

Reasons to File for Bankruptcy First

If you can complete bankruptcy proceedings before you file your divorce papers, this usually will streamline your divorce, and for numerous reasons:

  • Bankruptcy fees are the same whether you file individually or jointly; if you file for bankruptcy jointly with your spouse, you can save money.
  • If you take care of your debt before the divorce, property division becomes that much simpler.
  • If you discharge debt before you split, you can also save time in court if your spouse does not pay their debt, and then fails to reimburse you when creditors come after you for the debt.

One of the most contentious and worrisome parts of the divorce is dividing assets and debts. If you get rid of your debts before you enter the divorce, you can save yourself a good deal in time-consuming stress and in legal fees.

When You May Want to Start with Divorce

For the most part, however, the above reasons apply only to Chapter 7 bankruptcy, which only lasts a few months. You can quickly take care of this before a divorce. If you need to file for Chapter 13 bankruptcy, that is a process that lasts 3 to 5 years. In this case, it makes sense to start with the divorce. There can still be reasons, however, even in the Chapter 7 process to start with the divorce:

  • If you cannot get enough joint exemptions to save all your property from bankruptcy, then you might be able to protect more property by filing individually for bankruptcy after your assets and debt have been divided in a divorce.
  • Then there is the means test. To qualify for Chapter 7 bankruptcy, you have to establish that your income is low enough. If you file jointly with your spouse and your joint income disqualifies you, then you may want to complete the divorce so that you can qualify under your new individual income.

Just be aware that if you enter bankruptcy during a divorce, the bankruptcy's automatic stay means that you cannot finish the division of assets until the bankruptcy is over.

Successfully Moving on to a Brighter Future

If you need to gain a fresh financial start at the same time that you face a painful divorce, then your future is riding on two big legal processes. You do not want to be without the help of a seasoned legal professional in this time. It is crucial that you make the right choices so that you can regain a strong, independent future as swiftly as possible. Every divorcing couple's situation is unique, and your case will require a very specific solution. If you have questions about how property division proceeds, and how it could affect your future, be sure to call the Meyers Law Group, P.C.

After you are aware of what your first step is going to be, you will further need to be aware of your options when it comes to finding the right type of divorce, whether that means going through mediation, achieving an uncontested divorce, or going to court for a litigated divorce. Get the answers you need from an experienced divorce lawyer in Long Island when you call today!