It is not overstating the situation to say that divorce is a difficult and chaotic period in anyone’s life. After years of working to combine two lives, two incomes, two sets of assets, suddenly you begin working to separate them. Years and years of mutually-owned objects and assets must suddenly be assessed, valued, and divided.
If at the same time you are engaged in a divorce proceeding your financial situation is so dire that you are contemplating bankruptcy in order to vacate your debts and find some stability, you should contact one of our attorneys immediately to discuss your options. Bankruptcy can not only disrupt and complicate your divorce, it can actually delay it significantly.
The Automatic Stay
The issue is the Automatic Stay that is placed on all assets when your file for bankruptcy. This order will freeze all of your finances and assets, making it impossible for the divorce court to properly divide or even consider them. These two processes can be conducted simultaneously, but the impact on your divorce could slow it down to a crawl.
Your best options, if possible are:
- Pursue bankruptcy as a couple prior to filing for divorce. This will allow your finances and assets to be clarified and stabilized prior to the divorce proceeding.
- Wait until after the bankruptcy to file for divorce. This may not be possible if your assets are under extreme duress.
It should be common sense that engaging in two very complicated legal processes (divorce and bankruptcy) simultaneously makes both much more complex and slow-moving than if you pursue them individually. A divorce lawyer, no matter how capable, may not be an expert in bankruptcy laws; contact one of our bankruptcy lawyers and settle your affairs prior to the divorce.