Divorcing couples face a multitude of issues as they separate. Divorce and debt often go hand in hand, although many divorcing couples don’t realize it. In fact, one of the biggest hurdles they face can be their marital debt. Who will pay what? Will I be able to afford to pay the debt and meet my monthly bills for my new residence? How will I manage financially?
Filing For Bankruptcy Before Divorce
Filing for bankruptcy as a married couple has its benefits. If you qualify, as a married couple you may be able to file for Chapter 7 together. The Chapter 7 gives you a fresh start, wiping away the unsecured debt you both have accumulated, like credit card debt or medical debt. Additionally, as a married couple, you are paying one fee for your joint filing. Utilizing bankruptcy to reduce your debt load while married, results in there being fewer, if any, debts remaining to pay after your divorce.
Filing for Bankruptcy After Divorce
If you have already divorced, you may still be able to file bankruptcy. If you are paying debts that were divided through the divorce action, you are generally not eligible to discharge those debts in a Chapter 7. You may, however, use a Chapter 13 repayment plan, to pay what you are able to afford and achieve a discharge of the debt.
It is important to note that not all divorce-related debts can be discharged in bankruptcy. Agreements or Court Orders for alimony, or maintenance, as well as child-support are never eligible to be discharged in bankruptcy. There are a few other exceptions that are evaluated on a case-by-case basis.
Whether you are evaluating your financial situation before or after your divorce, we are here to help you determine what may be the best course of action for your individual situation. Make an appointment to speak with one of the experienced bankruptcy attorneys at O’Bryan Law Offices to discuss your options before moving forward with your divorce, or if you are struggling financially to meet all your obligations after your divorce. Bankruptcy can help give you relief from your financial worries. Call us today at 502-400-4020 for a free bankruptcy consultation and an explanation of Kentucky divorce laws.