With the divorce rate in America at an all-time high, we can assume that part of the problems in the marriage involves the marital debts.  Some of these couples will eventually need to file for bankruptcy, but the big question is should they file for bankruptcy BEFORE their divorce is complete or wait till the divorce is over and then file?

The following are some reasons that a debtor should consider filing for bankruptcy BEFORE the divorce is complete.  (these factors suggest that the debtors will file a joint bankruptcy).

  1. The filing of a joint bankruptcy prior to filing for divorce will allow each debtor to have a fresh start post bankruptcy, which basically means that they will have all of their unsecured debt eliminated, giving each debtor a clean slate.
  2. Some of your post bankruptcy debts are NON-DISCHARGEABLE.  Non-dischargeable refers to debts that survive the bankruptcy.  With regard to a divorce, any alimony debt/payment is non-dischargeable.
  3. If the debtors complete the divorce and then one spouse files for bankruptcy they leave the other spouse on the hook for the debt.  Example X and Y get divorced.  Y files for bankruptcy and discharges unsecured debt that Y and X were co-debtors on.  Once Y files for bankruptcy on that debt then the creditor will pursue X for the payment of the debt.
  4. It’s CHEAPER!!  When debtors are married they are allowed to file a joint petition which allows two debtors to file together for ONE price.   However once the divorce is complete each debtor must file their own bankruptcy forcing them to pay twice (one for each debtor).

If you are thinking of filing for bankruptcy and would like to schedule a free bankruptcy consultation in one of our five Florida offices in Boca Raton, Fort Lauderdale, Miami, Plantation, or Sunrise Florida then please give Shmucher Law, PL a call at 954.309.5559 or 305.741.5553.