- Mar 24, 2017
Everybody goes through challenging times in their life. Loss of employment, serious illness, and unexpected pregnancies are just a few of these. A leading reason why these experiences are so stressful is because financial difficulties are normally accompanied with them. In most cases, financial troubles are the leading cause of divorce, and on the contrary, divorce can be the leading cause of bankruptcy. So, it’s not surprising that we often see these two incidents happen concurrently. Though both actions are separate, the emotional features of such arrangements can create possible issues that cross paths and can result in a time-consuming and distressing process for both parties.
If you and your partner have made up your mind that divorce and bankruptcy are the best options in moving on with your lives, there are a variety of options that you must keep in mind. 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 couple of issues to consider.
To answer this question, you should go over your individual circumstances with a knowledgeable bankruptcy expert. You’ll need to discuss how you intend on dissolving the marriage– will the divorce be contested or uncontested? Or will particular issues be contested that will require lawsuits? Commonly, divorces are a very demanding process and there will be complications that emerge without your prior consideration. This simply emphasises the importance of proper research and planning.
If you’re confident that your soon to be ex-spouse will not see eye to eye on how to distribute your assets and debts, and litigation is more than likely, the first step you should take is to look for a skilled divorce lawyer. The key to a successful conclusion for both bankruptcy and divorce is having knowledgeable legal support. Both your bankruptcy professional and divorce lawyers will have to talk regularly to make sure they have all relevant information to give you the best case possible. Whilst both events are separate, there are subjects that will emerge in both cases that can significantly affect the result of each outcome.
In some cases, filing for bankruptcy prior to filing for divorce is advantageous. Both you and your spouse have the choice of filing a joint bankruptcy, as well as individual bankruptcies. Usually, both you and your spouse will owe creditors collectively, 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 distribution of property when the divorce is eventually filed. While bankruptcy does not separate joint assets and debts, it can usually eliminate sizable amounts of joint marital debt.
The most prevalent issue here is that filing for joint bankruptcy suggests that you and your spouse need to make joint decisions. If this is not practical, then joint bankruptcy will not be an option. 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 declines 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 after a divorce.
While both bankruptcy and divorce are difficult and time-consuming processes, they’re also an opportunity to move forward with your life and start over again. Understanding the complexities 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 commonly both actions will be less costly and time consuming. What is clear is that you should spend the time and money on knowledgeable law firms relating to both your divorce and bankruptcy. For more information, or to speak with someone about your personal circumstances, contact Bankruptcy Experts Cairns on 1300 795 575 or visit http://www.bankruptcyexpertscairns.com.au