Bankruptcy and divorce often go hand in hand, and this occurs mainly because of the financial effects divorce has on those going through it. If you are going through a divorce and are experiencing extreme financial problems, you could consider filing for bankruptcy for relief. If you decide to do this, it is important to understand the effects filing for bankruptcy may have on your divorce and your bankruptcy case, and here are a few things to know about this.
You can file together or alone
Going through a divorce does not stop you from filing for bankruptcy. In fact, you can file for bankruptcy before, during, or after your divorce, and you have the option of filing individually or jointly. Each of these options can have benefits, but you would need to compare which is best for your unique situation. If you file on your own, you might have an easier time qualifying for Chapter 7. If you file together, you will both likely find more relief from the debt you owe.
The timing of filing does not play a huge role in your bankruptcy case in terms of the results or effects bankruptcy offers, but it is still a good idea to talk to a lawyer to receive legal advice about timing your case in the best manner possible.
Bankruptcy will affect the assets in your divorce
The second thing to know is that if you are still married and file for bankruptcy, the bankruptcy will affect the assets you own, and this is true whether you file alone or with your spouse. After filing for bankruptcy, you will not be able to sell any of your assets or give them away. Your assets become part of your bankruptcy estate, and the trustee handling the case will monitor these assets. If you are filing for Chapter 7 bankruptcy, the trustee could seize assets from you to use for the repayment of your debt. Because of these effects, filing alone while you are still married could affect your spouse and could cause delays in the divorce.
You should find out the full effects before filing
If you cannot pay your debts and want to find relief, you should evaluate bankruptcy to see if this could be the solution you are looking for. You can do this by meeting with a bankruptcy lawyer of your choice, such as a Chapter 7 bankruptcy attorney. When you meet, you will be able to find out the full effects of bankruptcy before you file.