Being overburdened with debt can affect anyone, including those going through a divorce. You can declare bankruptcy before or after your divorce. Different factors make these significant life decisions connected.
This guide discusses the matter in more detail.
Before the divorce
Financial problems are one of the leading causes of marital problems, which may, in turn, lead to a divorce. If one spouse is sinking into high debt, they may not have time for the other, who may feel neglected or can pull away, and by the time they notice, it may be too late.
Moreover, declaring bankruptcy while married can worsen existing issues, especially if one doesn’t make the right moves after it.
Filing for bankruptcy doesn’t have to affect both spouses. One taking this step may not affect the other’s income or credit rating. But the non-filing party may experience some impact, and if the other fails to help, even providing emotional support, issues may arise or worsen in the marriage, leading to a divorce.
After the divorce
Some people declare bankruptcy after a divorce, especially those ordered to pay child and spousal support. It can be challenging to start a new life and simultaneously make court-ordered payments, especially when one loses income or gets other responsibilities.
Property division is another factor that may contribute to bankruptcy after a divorce. With the distribution of assets, one may not have the same properties as before to maintain their standard of living.
If a party doesn’t request a modification of spousal and child support or make changes in their life, they may get into debt.
Bankruptcy can lead to or can be a result of divorce. If you want to declare bankruptcy, it will help to obtain adequate information to get relief.