Everybody goes through challenging times in their life. Loss of employment, major illness, and unexpected pregnancies are just a handful of these. A leading reason why these incidents are so traumatic is because financial troubles are typically accompanied with them. In most cases, financial problems are the leading cause of divorce, and on the contrary, 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. Even though both actions are separate, the emotional features of such decisions can create potential issues that cross paths and can trigger a drawn-out and distressing process for both parties.
If you and your partner have made a decision that divorce and bankruptcy are the best options in moving forward with your lives, there are a few options that you must take into consideration. This article aims 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 couple of issues to consider.
To answer this question, you should discuss your specific circumstances with an experienced bankruptcy expert. You will need to discuss how you plan on dissolving the marriage– will the divorce be contested or uncontested? Or will some issues be contested that will require a lawsuit? Typically, divorces are a very demanding process and there will be matters that arise without your prior consideration. This merely accentuates the value of proper research and planning.
If you’re confident that your soon to be ex-spouse will not see eye to eye on the best ways to distribute your assets and debts, and litigation is more than likely, the first step you should take is to search for a qualified divorce lawyer. The key to a prosperous outcome for both bankruptcy and divorce is having knowledgeable legal support. Both your bankruptcy professional and divorce lawyers will want to converse regularly to make sure they have all relevant information to give you the best case possible. Although both events are separate, there are subjects that will emerge in both cases that can drastically affect the result of each outcome.
Sometimes, filing for bankruptcy prior to filing for divorce is favourable. Both you and your spouse have the choice of filing a joint bankruptcy, along with individual bankruptcies. Usually, both you and your spouse will owe creditors collectively, in which case filing for joint bankruptcy may be an enticing option. If you have not filed for divorce at this point, then bankruptcy can considerably assist to eliminate joint debt, and aids in the division of property when the divorce is subsequently filed. While bankruptcy does not split joint assets and debts, it can often eliminate substantial amounts of joint marital debt.
The most common concern here is that filing for joint bankruptcy implies that you and your spouse have to make joint decisions. If this is not conceivable, then joint bankruptcy will not be a solution. Also, once a divorce is filed, it’s highly likely that both parties will not settle on issues relating to bankruptcy, further complicating the process. If your soon to be ex-spouse declines to file for bankruptcy, then the process changes even further. Always bear in mind that a divorce does not have any effect on filing for bankruptcy, either jointly or individually, and this can be done any time prior to, during, or following a divorce.
While both bankruptcy and divorce are stressful and time-consuming processes, they’re also an opportunity to move on 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 paramount. If you’re in a position where you and your spouse can agree and make joint decisions, then normally both actions will be less costly and time consuming. What is clear is that you should invest the time and money on competent law firms relating to both your divorce and bankruptcy. To find out more, or to talk to someone about your individual circumstances, contact Bankruptcy Experts Coffs Harbour on 1300 795 575 or visit http://www.bankruptcyexpertscoffsharbour.com.au