Divorce or Bankruptcy?

For many people, divorce and bankruptcy are connected; in fact, financial issues are a frequent cause of divorce. Is it smarter to file for divorce first or to file for bankruptcy first? In most cases – but by no means all – you should take care of the bankruptcy first. If your financial problems can be removed by bankruptcy, your marriage might actually survive. And while bankruptcy may or may not save your marriage, there are other good reasons to file for bankruptcy before your marriage is dissolved. However, in any particular situation, you’ll need to have your situation analyzed by a good bankruptcy lawyer and then follow your lawyer’s advice. In the Chicago area, if you’re considering bankruptcy, and divorce is part of the equation, get sound legal counsel promptly from an experienced Chicago bankruptcy lawyer.

The cost of bankruptcy is much less for a joint filing than for two individual filings. When you file for bankruptcy before divorcing, it can also lower the cost of your divorce by simplifying the division of property; couples who file for bankruptcy before divorcing will also have fewer debts to worry about dividing. If you’re considering divorce, whether you’re filing jointly for bankruptcy or as an individual, let your bankruptcy lawyer know. Surprises usually are not helpful in bankruptcy filings.

If you divorce first, and your spouse then files for bankruptcy, the debt you incurred during the marriage is still your responsibility. A divorce is an agreement exclusively between you and your ex-spouse; it has no weight with creditors. If creditors can’t collect from your ex-spouse because of that partner’s bankruptcy, they’ll go after you. In the final analysis, however, there is no always-right answer when deciding whether to file for bankruptcy or divorce first. The advice of a good bankruptcy lawyer is imperative. In the greater Chicago area, before you take any legal action, discuss your options with an experienced Chicago bankruptcy lawyer.