Divorce is stressful. Filing for bankruptcy is stressful. Unfortunately, divorce and bankruptcy often go hand-in-hand, one almost inevitably leads to the other. That leaves many people with the stark decision, should they file for bankruptcy before or after their divorce? The answer depends on your situation and this post will discuss the factors you may want to consider.
The biggest factor you should consider is under what chapter you want to file for bankruptcy. For instance, Chapter 7 bankruptcies are ended in a few months. So you should be able to file for bankruptcy, settle out your debts, and divorce afterward. Of course, that depends on if you can cooperate through the bankruptcy process.
Chapter 13 is much longer, three to five years. If you want to obtain a divorce immediately following the closing of your bankruptcy, you may have to wait several years. If you try to divorce during the bankruptcy proceedings, you need to engage in a complicated procedure to separate your assets and continue separately.
Another thing to consider is cost. If you file jointly, it is far cheaper to go through bankruptcy, than as a single filer. Additionally, you can share the cost of the bankruptcy, such as the lawyer and court fees.
If you are stuck between filing for bankruptcy and divorce, you may want to contact a lawyer. An attorney can review the pros and cons of each option and help you determine the best strategy for you. Furthermore, a lawyer can point out other things to consider, such as your assets and whether you can get along with your spouse to finish the bankruptcy.