Everybody goes through challenging times in their life. Job loss, major illness, and unexpected pregnancies are just a few of these. A leading reason why these events are so traumatic is because financial complications are commonly accompanied with them. In most cases, financial challenges are the leading cause of divorce, and on the contrary, divorce can be the leading cause of bankruptcy. So, it’s not a surprise that we often see these two events happen at the same time. While both actions are separate, the emotional nature of such decisions can create possible issues that cross paths and can result in a time-consuming 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 forward with your lives, there are a variety of options that you must take into consideration. This article aims 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 a variety of issues to consider.
To answer this question, you should take a look at your specific circumstances with an experienced bankruptcy expert. You’ll need to discuss how you plan on dissolving the marriage– will the divorce be contested or uncontested? Or will certain issues be contested that will require a lawsuit? Commonly, divorces are a very intricate process and there will be issues that arise without your prior consideration. This simply highlights 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 the best ways to distribute your assets and debts, and litigation is more than likely, the first step you should take is to search for a qualified divorce lawyer. The key to a successful result for both bankruptcy and divorce is having experienced legal support. Both your bankruptcy specialist and divorce lawyers will want to converse frequently to ensure they have all relevant information to give you the best case possible. Even though both events are separate, there are issues that will arise in both cases that can significantly 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, as well as individual bankruptcies. Ordinarily, both you and your spouse will owe creditors jointly, 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 greatly assist to eliminate joint debt, and aids in the division of property when the divorce is ultimately filed. While bankruptcy does not split joint assets and debts, it can usually remove substantial amounts of joint marital debt.
The most frequent problem here is that filing for joint bankruptcy indicates that you and your spouse need to make joint decisions. If this is not attainable, then joint bankruptcy will not be a solution. Additionally, once a divorce is filed, it’s highly likely that both parties will not settle 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 lengthy processes, they’re also a chance to move forward 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 extremely important. If you’re in a situation 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 spend the time and money on experienced law firms relating to both your divorce and bankruptcy. To find out more, or to speak to someone about your personal circumstances, contact Bankruptcy Advice Perth on 1300 879 867 or visit https://www.bankruptcy-advice.com.au/perth