Obtaining Debt Relief After A Divorce
It is not unusual for one or both spouses to experience financial hardship after a divorce. Many times, the two spouses make enough money together to support one home, but they do not make enough money separately to support two. Divorce can be particularly hard on the spouse who is ordered to pay child support or alimony.
Many divorced people seek debt relief through bankruptcy only to find that the debts that are causing them trouble are not dischargeable under the law. That is not to say, however, that bankruptcy cannot provide relief in these situations. At the law offices of Oliver & Legg, our Toms River bankruptcy and divorce attorney will help you understand your rights and legal options.
What You Should Know About Bankruptcy And Divorce
The following are some important points to keep in mind as you are considering your debt relief options after, or in anticipation of, a divorce:
- Under the Bankruptcy Code, child support and alimony obligations are not dischargeable in bankruptcy under any chapter.
- Any equitable distribution debts ordered in the divorce are not dischargeable in a Chapter 7 bankruptcy, but are dischargeable in a Chapter 13 bankruptcy.
- If one spouse is ordered to pay a joint debt such as a credit card, and subsequently files bankruptcy, the creditor has the right to come after the other spouse for payment. The non-filing spouse can take legal action against the filing spouse, however, to enforce the original order. A Chapter 13 bankruptcy filing may solve this problem.
We can also advise you of the benefits and drawbacks associated with filing bankruptcy together if the divorce has not yet been finalized. It can often help to simplify the process of dividing marital debts and can leave both spouses in a stronger position post-divorce. If one spouse files for bankruptcy during a divorce proceeding, it can bring the divorce proceeding to a stop until the family court receives automatic stay relief from the bankruptcy court.
Free Consultation With A Monmouth County Family Debt Attorney
With offices in Toms River and Neptune City, our New Jersey bankruptcy lawyer is prepared to help you with any bankruptcy-related matter. Evening and Saturday appointments are available. Call local: 732-988-1500 or fill out our contact form.