Divorce 1st or BK 1st?

[treignz]

in the same boat here .. BK or DV first .. I think we are going to BK first since he has no income to speak of we will easily be able to CH7 - much less to haggle over in the DV. Just told him tonight we are going to have to BK the house because he can't afford it and pay me child support. DUH Married for 17 yrs so there is lots of stuff to deal with, plus kids, plus business .. it's gonna be a mess no matter what, but I am guess much less of a mess if we BK first and get rid of debt and house (no equity anyway). Sucks really really bad .. and we are just beginning this journey ......................... can't beleive I am about to literally 'start over' in so many ways!!! =(

Sorry to hear about what your going through; but then I feel your pain. I'm just glad that I don't have a business to deal with. the BK should make the D settlement a whole lot easier.

[fljb]

in the same boat here .. BK or DV first .. I think we are going to BK first since he has no income to speak of we will easily be able to CH7 - much less to haggle over in the DV. Just told him tonight we are going to have to BK the house because he can't afford it and pay me child support. DUH Married for 17 yrs so there is lots of stuff to deal with, plus kids, plus business .. it's gonna be a mess no matter what, but I am guess much less of a mess if we BK first and get rid of debt and house (no equity anyway). Sucks really really bad .. and we are just beginning this journey ......................... can't beleive I am about to literally 'start over' in so many ways!!! =(

[treignz]

Thanks

Thanks all who responded to my question. It was very enlightening. We are going to file BK first; then wait to make a decision on the D.

Thanks again.

[Tbornetun]

We're doing the Bkcy first -- I'd be over the median with just me and my daughter if I waited until after.

We had our 341 meeting today and have my divorce attorney working on my petition. Both my D and B attorney's advised I wait until after the 341 to officially file for divorce.

Sounds like a good plan, every case is different.

[Kim in MN]

We're doing the Bkcy first -- I'd be over the median with just me and my daughter if I waited until after.

We had our 341 meeting today and have my divorce attorney working on my petition. Both my D and B attorney's advised I wait until after the 341 to officially file for divorce.

[filingin08]

Well they both could be correct in their respective areas.

The Divorce Lawyer is correct that Divorce and property settlements are not dischargeable in a BK. Thus if the D happened first and the divorce decree established that she would get the car and you would continue to pay the car until it was paid off then that could not be discharged. If this is something you don't want then BK first is the answer.

Depending on your household income, it is possible the BK lawyer is also telling you the truth if both of your incomes combined place you over the median income.

I'm not sure this is correct. Divorce debt is dischargeable in a 13 IF it is not child support, alimony or other support. My case: Husband was ordered to pay credit cards, boat, lease in property settlement with ex-wife. In a 13, his obligation to the creditor will be discharged AND so will his obligation to her. In a 7, his obligation to the creditor would be discharged but not his obligation to her and she could sue in family court to make her whole.

[Tbornetun]

I am accomplishing the same thing but I am getting the divorce first. And, we couldn't qualify for a CH 7 if we filed jointly because we would be over the median income for our state. However, we can both file CH 7 on our own because our individual incomes will be under the median. As long as the divorce judgment states that we are each responsible for debt in our name individually and we are both responsible for paying the joint debt, aren't we going to end up the same way?

Your right, that would be the other way to go if it is necessary. If you are over median income jointly, it would be best.

But if you are not, BK first will take some of the stress off by getting the creditors to go away. Chapter 7 lasts approx 3-4 months, divorce can sometimes take 6 months to 2 years. Most of that time is spent dividing (fighting over) assets and debts.

I don't know the laws in every state, but in Minnesota you can serve the other party with the petition for dissolution and summons then not file the documents at the court until months later. In the interim the summons will prohibit either party from selling assets or incurring more debt in the others name. During this time they can also file and discharge their debts in bankruptcy.

[treignz]

My soon to be ex is filing before the divorce, so for him, the family income is below the means test when he files. I will file BK after the divorce is final. I have been a mostly stay at home mom for 18 years and a full time student for the past 2 years. Due to almost $60K in joint credit card debt, I have no choice but to file since he is.

Whatever is most advantageous for you. You probably will not get the "fairest" most optimal result since you are no longer a "team", but you can mitigate your losses. No court, bankruptcy or family court is going to absolve you of everything because your ex or soon to be ex is a whacko, or a liar or a thief. You may get stuck paying for something that just isn't fair. You may have to settle for the least financially damaging solution rather than the best case scenario, because absolute justice, for you, may not exist. I learned the hard way. Doesn't seem fair that he can live it up on our joint credit for the last 5 years and then BK it away, leaving me holding the ball, but he can. I could try to get a spousal support order to cover his 1/2 of the debt, you know, "make him pay" but he really doesn't have the means to.After my initial shock, I'm resigned to it.

I was pretty much destroyed over the realization that not only is my marriage OVER, I am going to have to file bankruptcy too

I'm sorry to hear about your situation. I know it must be hard. BK is not as bad as you think it might be. My W filed in 2000. Up until the time that she quit paying bills again, she was able to live like it never happened.

In my case, I let her go on too long and now here I am. She's left me with the kids and the debt. I'll manage; it'll probably be easier without her as far managing the money.

I used to joke that when I met my W, the only bill I had was my truck payment; now it's the only thing I got that's paid for and I still got it.

[2Bshinyandnew]

My soon to be ex is filing before the divorce, so for him, the family income is below the means test when he files. I will file BK after the divorce is final. I have been a mostly stay at home mom for 18 years and a full time student for the past 2 years. Due to almost $60K in joint credit card debt, I have no choice but to file since he is.

Whatever is most advantageous for you. You probably will not get the "fairest" most optimal result since you are no longer a "team", but you can mitigate your losses. No court, bankruptcy or family court is going to absolve you of everything because your ex or soon to be ex is a whacko, or a liar or a thief. You may get stuck paying for something that just isn't fair. You may have to settle for the least financially damaging solution rather than the best case scenario, because absolute justice, for you, may not exist. I learned the hard way. Doesn't seem fair that he can live it up on our joint credit for the last 5 years and then BK it away, leaving me holding the ball, but he can. I could try to get a spousal support order to cover his 1/2 of the debt, you know, "make him pay" but he really doesn't have the means to.After my initial shock, I'm resigned to it.

I was pretty much destroyed over the realization that not only is my marriage OVER, I am going to have to file bankruptcy too

[treignz]

As for the car she is driving that you are making payments on, get rid of it. Why should you make payments on a car she is allowed to drive if you are filing bankruptcy and seeking a divorce. Doesn't make sense.

The only reason is that I know she can't get a good car on her own because of the credit situation. When she has the kids; I want to know that they are in a dependable car and a safe car. That's the only reason. Having said that, I don't want to be liable as she is going out all the time when she doesn't have the kids.

[cupcake]

In similar cases, we have tried to get the other spouse to filing jointly prior to divorce. Then neither of you will be liable for anything in the divorce, and you can both leave debt free. It also helps with exempting assets, when you file jointly, you get double the exemptions than if you were to file individually.

I am accomplishing the same thing but I am getting the divorce first. And, we couldn't qualify for a CH 7 if we filed jointly because we would be over the median income for our state. However, we can both file CH 7 on our own because our individual incomes will be under the median. As long as the divorce judgment states that we are each responsible for debt in our name individually and we are both responsible for paying the joint debt, aren't we going to end up the same way?

[Tbornetun]

In similar cases, we have tried to get the other spouse to filing jointly prior to divorce. Then neither of you will be liable for anything in the divorce, and you can both leave debt free. It also helps with exempting assets, when you file jointly, you get double the exemptions than if you were to file individually.

Our firm does family law, business law, estate planning, as well as bankruptcy. Many times we see people come in not knowing if they want a divorce or if they want to file bankruptcy. It of course varies on the situation but it might be worth it to you for both of you to file prior to the divorce. As for the car she is driving that you are making payments on, get rid of it. Why should you make payments on a car she is allowed to drive if you are filing bankruptcy and seeking a divorce. Doesn't make sense.

[treignz]

I've done extensive research with the means test. I am aware of where I stand in those figures. My main concern is that I want to file both in the most advantageous order. In other words, I don't want to be in a position where I have non-dischargeable unsecured debt if I divorce first. I know that support, alimony, and like is non-dischargeable. Property settlements are a little more ambiguous. I have one L saying to D first and my D L saying BK first.

I'm just trying to weigh those options. I will most likely have the kids and I don't want to be financial liable for a financially risky ex-spouse.

[2Bshinyandnew]

From http://www.legalconsumer.com/bankruptcy/

Kentucky Median Income
Kentucky Bankruptcy Information
If your average monthly income for the past six months is below the state median for your size household, you meet the requirements of the "means test" (section 707(b)(2) of the bankruptcy code) to qualify for Chapter 7 Bankruptcy.
Persons in Household Monthly Annual
1 $2,940 $35,274
2 $3,649 $43,793
3 $4,445 $53,343
4 $5,258 $63,097
5 $5,833 $69,997
6 $6,408 $76,897
7 $6,983 $83,797
8 $7,558 $90,697
9 $8,133 $97,597
10 $8,708 $104,497


Source: U.S. Trustee, U.S. Department of Justice (for cases filed on or after February 1, 2008)

Note. The means test is but one of several hoops you must jump through. Even if your income is low, a judge can prevent you from filing Chapter 7 if it appears that you have enough income to repay a substantial portion of your debts in a 3-year Chapter 13 plan.

[allavdj]

If she is doing things like writing hot checks, it might be wise to get the divorce asap so you aren't liable for anything she does financially. And by the looks of the income, you will probably be over the median with or without her.

I would get yourself out of the marriage first, then take care of the messed up finances.