Everybody experiences difficult times in their life. Loss of employment, serious illness, and unplanned pregnancies are just a few of these. A leading reason why these incidents are so traumatic is because financial problems are commonly accompanied with them. In most cases, financial difficulties are the leading cause of divorce, and on the other hand, divorce can be the leading cause of bankruptcy. So, it’s not a surprise that we often see these two events happen simultaneously. Whilst both actions are separate, the emotional features of such decisions can create possible issues that cross paths and can create a time-consuming and painful process for both parties.
If you and your spouse have concluded that divorce and bankruptcy are the best options in moving on 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 variables to consider.
To answer this question, you should talk about your specific circumstances with a knowledgeable bankruptcy expert. You will need to discuss how you intend on dissolving the marriage– will the divorce be contested or uncontested? Or will some issues be contested that will require lawsuits? Generally, divorces are a very intricate process and there will be matters that arise without your prior consideration. This merely accentuates the importance of adequate research and planning.
If you’re confident that your soon to be ex-spouse will not agree on ways to split your assets and debts, and litigation is more than likely, the first step you should take is to find a skilled divorce lawyer. The key to a successful outcome for both bankruptcy and divorce is having knowledgeable legal support. Both your bankruptcy professional and divorce lawyers will have to talk frequently to make sure they have all relevant information to give you the best case possible. Although both events are separate, there are topics 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 beneficial. Both you and your spouse have the option of filing a joint bankruptcy, as well as individual bankruptcies. Commonly, both you and your spouse will owe creditors jointly, in which case filing for joint bankruptcy may be an appealing option. If you have not filed for divorce at this point, then bankruptcy can substantially help to eliminate joint debt, and aids in the distribution of property when the divorce is subsequently filed. While bankruptcy does not split joint assets and debts, it can often eliminate sizable amounts of joint marital debt.
The most frequent complication here is that filing for joint bankruptcy suggests that you and your spouse will need 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 agree 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 keep in mind 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 a chance to move forward with your life and start over again. 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 generally both actions will be less costly and time consuming. What is clear is that you should devote the time and money on proficient law firms relating to both your divorce and bankruptcy. To find out more, or to speak with someone about your individual circumstances, contact Bankruptcy Experts Shellharbour on 1300 795 575 or visit http://www.bankruptcyexpertsshellharbour.com.au