Is it better to declare bankruptcy before or after divorce/separation?

My wife and I will be divorcing. She cannot afford to live on her own unless she files for bankruptcy to eliminate the credit cards in her name. Therefore we have not taken any action as far as a legal separation yet and are still living together. Although I have some debt I will not be filing. We both own the house (both names on the mortgage), which I will be keeping. We each have a car, with auto loans. We share a bank account. Would it make a difference if she files before or after the divorce is finalized? I am concerned about my own credit, funds and property being affected by her filing.

Asked on August 20, 2011 New York

Answers:

FreeAdvice Contributing Attorney / FreeAdvice Contributing Attorney

Answered 8 years ago | Contributor

In order to answer your question concerning the timing of your anticipated bankruptcy filing the answer to that question (pre or post divorce) is better suited to the attorney that you are consulting with for the bankruptcy.

However, since bankruptcy gives one a fresh start financially, and since you and your wife plan on divorcing, practicalities suggest that the bankruptcy be filed before the divorce is filed. By doing such, many of the debts that would have to be allocated during the dissolution process of your marriage would be eliminated upon a bankrupcty discharge.

Also, possibly the bankruptcy may eliminate a lot of the financial stress you and your wife have where the divorce plans may not happen.


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