Everyone experiences strenuous times in their life. Losing a job, severe illness, and unexpected pregnancies are just a handful of these. A leading reason why these experiences are so traumatic is because financial difficulties are usually accompanied with them. In many cases, financial challenges 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 sometimes see these two situations happen simultaneously. Whilst both actions are separate, the emotional features of such decisions can create potential issues that cross paths and can bring about a lengthy and distressing process for both parties.
If you and your companion have come to the decision that divorce and bankruptcy are the best options in moving on with your lives, there are various 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? Sadly, there is no ‘one-size-fits-all’ approach to answer this question, as there are several issues to think about.
To answer this question, you should discuss your specific circumstances with a qualified bankruptcy expert. You will need to discuss how you plan on dissolving the marriage– will the divorce be contested or uncontested? Or will several issues be contested that will require litigation? Commonly, divorces are a very intricate process and there will be matters that arise without your prior consideration. This simply emphasises the importance of sufficient research and preparation.
If you’re confident that your soon to be ex-spouse will not see eye to eye on ways to split your assets and debts, and litigation is more than likely, the first step you should take is to find a knowledgeable divorce lawyer. The key to a successful conclusion for both bankruptcy and divorce is having knowledgeable legal support. Both your bankruptcy professional and divorce lawyers will have to converse regularly to make sure they have all relevant information to give you the best case possible. Even though both events are separate, there are matters that will develop in both cases that can drastically 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 option of filing a joint bankruptcy, as well as individual bankruptcies. Commonly, both you and your spouse will owe creditors collectively, in which case filing for joint bankruptcy may be an attractive 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 separate joint assets and debts, it can usually eliminate substantial amounts of joint marital debt.
The most frequent issue here is that filing for joint bankruptcy means that you and your spouse have to make joint decisions. If this is not practical, then joint bankruptcy will not be a solution. In addition, 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 refuses to file for bankruptcy, then the process changes even further. Always bear in mind 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 on with your life and start over again. 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 costly and time consuming. What is clear is that you should spend the time and money on knowledgeable law firms relating to both your divorce and bankruptcy. For more information, or to talk to someone about your personal circumstances, contact Bankruptcy Experts Geraldton on 1300 795 575 or visit http://www.bankruptcyexpertsgeraldton.com.au