Few people enter a marriage with the expectation of divorce, and few people start spending money with the intention of filing for bankruptcy. Unfortunately, bankruptcy and divorce often go hand in hand. While two separate legal processes, couples often choose to undergo both at the same time.
Do Money Problems Really Lead to Divorce?
Yes, quite often. If you are constantly worried about money and arguing over who is spending how much, it is likely that communication may be suffering. Debt can lead to overwhelming anxiety. Additionally, the belief of one spouse that the other is spending foolishly is 45% more likely to lead to divorce.
Does Bankruptcy Change the Divorce Process?
In short, yes. If you choose to file when you divorce, you are likely to slow down the proceedings. This does not make it a bad idea, but it is something to prepare for. The state will not make decisions about your property, but a judge can still rule on issues like custody, alimony and child support.
Will I Be Forced to Pay for Joint Debt if My Ex Filed Bankruptcy?
If your spouse filed for divorce separately from you, creditors can still come to you to collect the debt. If you took on the debt together, you are still expected to pay for it. On the other hand, you can still take your ex-spouse to court to recoup the costs.
Does Bankruptcy Wipe Out Every Debt?
Bankruptcy does not necessarily exempt you from paying back property declared as part of the divorce decree. Filing a Chapter 13 plan may allow you to make installments, however. Bankruptcy also will not clear alimony or child support.
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