Everybody passes through difficult times in their life. Loss of employment, major illness, and unexpected pregnancies are just a handful of these. A leading reason why these situations are so stressful is because financial troubles are often accompanied with them. In many cases, financial troubles are the leading cause of divorce, and likewise, divorce can be the leading cause of bankruptcy. So, it’s not surprising that we occasionally see these two events happen at the same time. Whilst both actions are separate, the emotional features of such arrangements can create potential issues that cross paths and can result in a lengthy and distressing process for both parties.
If you and your spouse have decided that divorce and bankruptcy are the best options in moving forward with your lives, there are various options that you must take into consideration. This article strives to shed some light into a common question experienced by many in this position– which comes first: bankruptcy or divorce? Sadly, there is no ‘one-size-fits-all’ approach to answer this question, as there are a variety of issues to consider.
To answer this question, you should review your specific circumstances with a competent bankruptcy expert. You will need to discuss how you anticipate dissolving the marriage– will the divorce be contested or uncontested? Or will particular issues be contested that will require a lawsuit? Regularly, divorces are a very demanding process and there will be complications that appear without your prior consideration. This merely emphasises the importance of adequate research and preparation.
If you’re confident that your soon to be ex-spouse will not see eye to eye on how you can split your assets and debts, and litigation is more than likely, the first step you should take is to seek a skilled divorce lawyer. The key to a successful outcome for both bankruptcy and divorce is having skillful legal support. Both your bankruptcy specialist and divorce lawyers will have to correspond regularly to ensure they have all relevant information to give you the best case possible. Although both events are separate, there are issues that will emerge in both cases that can drastically affect the result of each outcome.
In some cases, filing for bankruptcy before filing for divorce is favourable. Both you and your spouse have the option of filing a joint bankruptcy, along with individual bankruptcies. Ordinarily, both you and your spouse will owe creditors collectively, in which case filing for joint bankruptcy may be an attractive option. If you have not filed for divorce at this point, then bankruptcy can substantially assist to eliminate joint debt, and aids in the division of property when the divorce is subsequently filed. While bankruptcy does not separate joint assets and debts, it can often eliminate sizable amounts of joint marital debt.
The most common concern here is that filing for joint bankruptcy suggests that you and your spouse have to make joint decisions. If this is not conceivable, then joint bankruptcy will not be an option. On top of that, once a divorce is filed, it’s highly likely that both parties will not come to an understanding matters relating to bankruptcy, further complicating the process. If your soon to be ex-spouse refuses to file for bankruptcy, then the process changes even further. Always remember that a divorce does not have any effect on filing for bankruptcy, either jointly or individually, and this can be done at any time before, during, or after a divorce.
While both bankruptcy and divorce are difficult and lengthy processes, they’re also an opportunity to move forward with your life and start anew. Understanding the complexities of both actions is the key to successful outcomes, so an experienced legal support team is very important. If you’re in a situation where you and your spouse can agree and make joint decisions, then usually both actions will be less costly and time consuming. What is clear is that you should devote the time and money on competent law firms relating to both your divorce and bankruptcy. For more information, or to speak with someone about your personal circumstances, contact Bankruptcy Experts Mildura on 1300 795 575 or visit http://www.bankruptcyexpertsmildura.com.au