Divorce is one of many causes for filing bankruptcy. Can you file for bankruptcy if you are going through a divorce? The answer to the debtor’s question is technically yes, but divorce creates extenuating circumstances that you might want to consider before you file. Filing for bankruptcy after you have already filed for divorce might not be wise in some situations, and it may be the very thing to do in other situations, all depending on your particular situation.
Probably the most influencing factor on whether you file bankruptcy before a final divorce decree is whether you live in a community property or non-community property state. Both types of state laws can impact the type of bankruptcy you file and when.
What might by treated as community property or equitable distribution assets might make a difference on when you might want to file a bankruptcy. In divorce law, community property and equitable distribution are handled by state laws which determine how marital property should be divided by a divorce court.
In bankruptcy cases, bankruptcy laws do not necessarily view community property or equitable distribution the same way as divorce courts do, especially if the divorce has not been finalized. For instance, if one spouse is wanting to file a bankruptcy, the bankruptcy courts cannot take checking accounts of the other spouse who has an individual account where the filing spouse has not contributed. Bankruptcy courts can take any jointly owned assets. Divorce courts, on the other hand, may view an individual account as community property if the two have been living together and supporting each other.
What might be more important than whether you can file a bankruptcy during a divorce is how you file for bankruptcy and whether or not you live in a state that is a community property state, whether you have assets, and what bankruptcy you file. These factors may also influence your decision to file separately, as an individual, or jointly.
Divorce proceedings can complicate already complicated bankruptcy laws. It usually is best to file for bankruptcy protection before you file for divorce or after a divorce decree, but if you are already in a divorce situation, it may be advantageous for you to file anyway.
If you are considering bankruptcy, talk to a bankruptcy lawyer. If you need of relief from the stress of debt and you live in or around the metropolitan area of Pittsburgh, Pennsylvania, contact us at www.betterbankruptcy.com .We will help you find a bankruptcy attorney in your area who will answer your bankruptcy questions.
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