Steve Novak: Does Bankruptcy Affect Divorce?

Depending on your financial situation, it may seem like it is a sensible decision to file for bankruptcy at the same time as you file for divorce, especially if large debt was a major contributing factor to your divorce. However, these two legal processes can occasionally complicate each other when they occur at the same time and make the divorce process in particular go quite a bit slower. You’ll want to speak with a Chapter 7 Lawyer to make sure you are doing the right thing. At our office, we have active cases in both divorce and bankruptcy, so you can feel secure knowing that we can help you with your case.

Bankruptcy and Divorce Lawyer

If you file for bankruptcy during a divorce, the divorce court can still make decisions regarding items such as alimony, child support, child custody and visitation. However, the property division process cannot begin so long as bankruptcy courts still have control over your property.

It is also important to understand that just because you file for bankruptcy does not mean you will automatically be excused from certain joint debts that you incurred during the course of your marriage. Although bankruptcy may forgive these debts for you and put the responsibility on the shoulders of your ex-spouse, in most cases that spouse will be advised to take you back to divorce court to get an order for you to pay him or her back.

Certain divorce debts cannot be eliminated at all from bankruptcy. Alimony and child support will never be forgiven through bankruptcy, end neither will any payments that you make to your spouse as part of an exchange for property.

Some Reasons You Should Consider an Annulment Instead of a Divorce

All 50 states allow for no-fault divorces, but there are some circumstances in which you might prefer to get an annulment instead. While most marriages don’t qualify for an annulment, those that do might be better served by this process rather than divorce.

The following are a few common reasons why people choose annulments:

New information has come to light: Under Utah law, you must be able to demonstrate something you have found out since the marriage occurred would have stopped you from legally entering the marriage had you known about it earlier. Examples include a spouse who was already married, an enormous debt you were not aware of, lies about identity or other forms of fraud.
You are religious: Some religions, such as Catholicism, require you to have your marriage annulled by the church if you wish to get remarried someday. You may have a civil divorce and a religious annulment and still get remarried, although you might wish to get a legal annulment for simplicity’s sake. Keep in mind that the standards for a legal annulment are not the same as those for a religious annulment.
You do not want the divorce on public record: Some people wish to keep the record of their divorce out of the public eye. An annulment is not subject to public record like a divorce is, and so it can offer you some privacy in that regard.
You expect property division to be an issue: If you expect complications to arise with the division of marital property, going through the annulment process could prevent you from losing a portion of your assets.

Free Consultation with Bankruptcy Lawyer

If you have a bankruptcy question, or need to file a bankruptcy case, call Ascent Law now at (801) 676-5506. Attorneys in our office have filed over a thousand cases. We can help you now. Come in or call in for your free initial consultation.