Tag: filing bankruptcy before divorce

Bankruptcy Law, Debt Relief, Timothy Kingcade Posts

Divorce & Bankruptcy – How They Are Connected

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Medical bills, job loss and divorce are some of the main reasons people file for bankruptcy today.  Financial problems can sometimes lead to divorce and as a result it is not uncommon for couples to decide to file bankruptcy right after they get divorced.  Here are some things to consider.

Whether or not you decide to file for bankruptcy before or after your divorce depends on the following:

  • Which type of bankruptcy you file– If you file together, both of your incomes are used to qualify you for a Chapter 7, which may make you ineligible for this type of bankruptcy. An experienced bankruptcy attorney will help you determine which type of bankruptcy to file, a Chapter 7 or Chapter 13.
  • State exemption laws– All property you own is declared either exempt or non-exempt during a bankruptcy.  Exempt property may be kept after the bankruptcy case has concluded. Florida has one of the most generous homestead exemptions in the country.  Here are some of the most common bankruptcy exemptions in Florida.
  • State laws concerning division of property during a divorce could be at odds with what property is exempt in a bankruptcy.  The items you fought to keep after your marriage comes to an end could be in jeopardy, again in subsequent bankruptcy proceedings.
  • The cost for filing a joint bankruptcy is the same as filing an individual one.  This means you can save hundreds of dollars by filing together.
  • Work together if possible. Filing bankruptcy jointly implies that you can work together, something that may be difficult to do, but worth it in the end.

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If you have any questions on this topic or are in financial crisis and considering filing for bankruptcy, contact an experienced Miami bankruptcy attorney who can advise you of all of your options. As an experienced CPA as well as a proven bankruptcy lawyer, Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. Since 1996 Kingcade Garcia McMaken has been helping people from all walks of life build a better tomorrow. Our attorneys’ help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade Garcia McMaken website at www.miamibankruptcy.com.

 

Bankruptcy Law, Debt Relief, Timothy Kingcade Posts

Reasons to File Bankruptcy before Divorce

Posted on by Admin

Financial stress caused by the way couples view and spend money can ultimately lead to divorce.  If you are facing both of these issues, does it make sense to file for bankruptcy or divorce, first?  The bottom line: Divorce will most likely not make the financial pressure go away, oftentimes it compounds it.

Here are some reasons why you should file bankruptcy before divorce.

You will save money filing jointly. If you are still married, you can file your bankruptcy case together.  This will allow you to pay one court filing fee, one set of documents and scheduling, one meeting of the creditors and one attorney fee.

Filing for bankruptcy together will free you of any liability on joint debt.  If you file for bankruptcy before divorce you will be off the hook for paying joint debt acquired during the marriage.  However, if you file for divorce first and receive a divorce settlement, you may still be responsible for some (or all) of the joint debt.  Essentially, you may have to cover your spouse’s liability.

Filing jointly doubles the exemption amounts.  When you file for bankruptcy, you are allowed to keep some property in order to regain a fresh start.  These exemption amounts are usually limited or capped.  However, if you file a bankruptcy case with your spouse, in most states you and your spouse will each be able to claim a full set of exemptions.

It saves you time. If one spouse files for bankruptcy in the middle of the divorce case, the bankruptcy judge may take jurisdiction of any property settlements, which can cause delays.  Filing a joint bankruptcy will eliminate most (if not all) unsecured debt, such as credit cards, medical bills and personal loans for both spouses, allowing the divorce to go much smoother when negotiating debt and property division.

It reduces stress.  Eliminating debt and reducing financial pressures can in turn reduce stress in the marriage.  If the marriage ultimately cannot be saved, it can help the divorce proceed more amicably.

Keep in mind, if your spouse files for bankruptcy before or during the divorce case and you do not, you may ultimately be responsible for all of the marital debt. This is because your spouse used the bankruptcy case to eliminate his or her liability on your joint debts.

If you have any questions on this topic or are in financial crisis and considering filing for bankruptcy, contact an experienced Miami bankruptcy attorney who can advise you of all of your options. As an experienced CPA as well as a proven bankruptcy lawyer, Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. Since 1996 Kingcade Garcia McMaken has been helping people from all walks of life build a better tomorrow. Our attorneys’ help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade Garcia McMaken website at www.miamibankruptcy.com.

Related Resources:

https://www.thebalance.com/six-reasons-to-file-bankruptcy-before-the-divorce-316343