Everyone passes through challenging times in their life. Losing a job, serious illness, and unexpected pregnancies are just a couple of these. A leading reason why these events are so traumatic is because financial challenges are generally accompanied with them. In most cases, financial troubles are the leading cause of divorce, and conversely, divorce can be the leading cause of bankruptcy. So, it’s not a surprise that we sometimes see these two events happen in unison. While both actions are separate, the emotional features of such decisions can create possible issues that cross paths and can lead to a lengthy and distressing process for both parties.
If you and your companion have made up your mind that divorce and bankruptcy are the best options in moving on with your lives, there are a few options that you must keep in mind. This article strives to shed some light into a common question experienced by many in this position– which comes first: bankruptcy or divorce? Unfortunately, there is no ‘one-size-fits-all’ approach to answer this question, as there are a couple of variables to think about.
To answer this question, you should go over your individual circumstances with a professional bankruptcy expert. You will need to discuss how you anticipate dissolving the marriage– will the divorce be contested or uncontested? Or will certain issues be contested that will require litigation? Normally, divorces are a very intricate process and there will be matters that develop without your prior consideration. This simply emphasises the importance of proper research and preparation.
If you’re confident that your soon to be ex-spouse will not see eye to eye on how to distribute your assets and debts, and litigation is more than likely, the first step you should take is to search for a knowledgeable divorce lawyer. The key to a prosperous outcome for both bankruptcy and divorce is having skillful legal support. Both your bankruptcy specialist and divorce lawyers will need to converse frequently to ensure they have all relevant information to give you the best case possible. Although both events are separate, there are issues that will develop in both cases that can considerably affect the result of each outcome.
In some cases, filing for bankruptcy prior to filing for divorce is beneficial. Both you and your spouse have the choice of filing a joint bankruptcy, in addition to individual bankruptcies. Usually, both you and your spouse will owe creditors jointly, 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 dramatically assist to eliminate joint debt, and aids in the distribution of property when the divorce is eventually filed. While bankruptcy does not split joint assets and debts, it can usually eliminate significant amounts of joint marital debt.
The most frequent complication here is that filing for joint bankruptcy indicates that you and your spouse will need to make joint decisions. If this is not conceivable, then joint bankruptcy will not be an option. Along with that, once a divorce is filed, it’s highly likely that both parties will not come to an understanding issues relating to bankruptcy, further complicating the process. If your soon to be ex-spouse refuses to file for bankruptcy, then the process changes even further. Always remember 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 difficult and time-consuming processes, they’re also an opportunity to move forward with your life and start afresh. Understanding the intricacies of both actions is the key to successful outcomes, so an experienced legal support team is critical. If you’re in a position where you and your spouse can agree and make joint decisions, then normally both actions will be less expensive and time consuming. What is clear is that you should devote the time and money on competent law firms relating to both your divorce and bankruptcy. For more information, or to talk to someone about your personal circumstances, contact Bankruptcy Experts Gympie on 1300 795 575 or visit Bankruptcy Gympie