Everyone experiences difficult times in their life. Loss of employment, major illness, and unexpected pregnancies are just a couple of these. A leading reason why these incidents are so traumatic is because financial complications are usually accompanied with them. In many cases, financial problems are the leading cause of divorce, and conversely, divorce can be the leading cause of bankruptcy. So, it’s no surprise that we occasionally see these two situations happen in unison. Although both actions are separate, the emotional features of such decisions can create possible issues that cross paths and can bring about a lengthy 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? Unfortunately, there is no ‘one-size-fits-all’ approach to answer this question, as there are a number of factors to think about.
To answer this question, you should talk about your particular circumstances with an experienced bankruptcy expert. You will need to discuss how you intend on dissolving the marriage– will the divorce be contested or uncontested? Or will several issues be contested that will require lawsuits? Usually, divorces are a very complex process and there will be issues that develop without your prior consideration. This simply accentuates the importance of effective research and planning.
If you’re confident that your soon to be ex-spouse will not see eye to eye on ways to distribute your assets and debts, and litigation is more than likely, the first step you should take is to find a competent divorce lawyer. The key to a prosperous outcome for both bankruptcy and divorce is having knowledgeable 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. Whilst both events are separate, there are matters that will develop in both cases that can substantially 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. Generally, both you and your spouse will owe creditors together, in which case filing for joint bankruptcy may be an enticing option. If you have not filed for divorce at this point, then bankruptcy can dramatically help to eliminate joint debt, and aids in the division of property when the divorce is eventually filed. While bankruptcy does not split joint assets and debts, it can usually eliminate sizable amounts of joint marital debt.
The most frequent concern here is that filing for joint bankruptcy implies that you and your spouse need to make joint decisions. If this is not conceivable, then joint bankruptcy will not be a solution. Additionally, once a divorce is filed, it’s highly likely that both parties will not agree on matters 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 remember that a divorce does not have any effect on filing for bankruptcy, either jointly or individually, and this can be done at any time prior to, during, or following a divorce.
While both bankruptcy and divorce are stressful 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 extremely important. If you’re in a situation where you and your spouse can agree and make joint decisions, then usually 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. For additional information, or to speak to someone about your individual circumstances, contact Bankruptcy Experts Fremantle on 1300 795 575 or visit http://www.bankruptcyexpertsfremantle.com.au