Filing for Bankruptcy During a Divorce: What You Need to Know

Posted by Antonio G. Jimenez, Esq. | Oct 05, 2023 | 0 Comments

In general, you can file for bankruptcy during a divorce in Florida. However, there are several considerations and implications to be aware of:

1. Simplifying Asset and Debt Division: If you file for bankruptcy before your divorce is finalized, it may simplify the division of assets and debts in the divorce proceedings. Once bankruptcy discharges certain debts, these debts are no longer a point of contention in the divorce.

2. Automatic Stay: When you file for bankruptcy, an automatic stay is imposed. This means that all collection actions against you will be paused. In some instances, it can also delay the divorce process, especially if financial issues are unresolved.

3. Type of Bankruptcy: If you're filing for **Chapter 7 bankruptcy**, the process might be relatively quick, potentially concluding within several months. This can allow your divorce to proceed with a clearer financial picture. On the other hand, **Chapter 13 bankruptcy** involves a 3 to 5-year repayment plan, which might complicate the divorce process due to its longer duration.

4. Joint Debts: If you and your spouse have joint debts and only one of you files for bankruptcy, the creditor may attempt to collect the entire debt from the non-filing spouse.

5. Property Division: If you file for bankruptcy while your divorce is ongoing, it could complicate how property is divided. The bankruptcy court may have a say in what happens to your joint assets.

6. Legal Costs: Both divorce and bankruptcy come with legal fees and costs. It's important to consider whether you can afford to pay for both processes simultaneously.

7. Strategic Timing: Some individuals choose to file for bankruptcy before starting the divorce process to simplify asset and debt division. Others might wait until after the divorce is finalized to determine if bankruptcy is necessary.

8. Attorney Consultation: Given the intricacies involved in both bankruptcy and divorce, it would be wise to consult with both a family law attorney and a bankruptcy attorney to determine the best course of action for your specific situation.

In essence, while it's possible to file for bankruptcy during a divorce in Florida, the decision involves multiple factors and potential complications. It's crucial to understand the implications fully and seek professional legal advice before proceeding.

About the Author

Antonio G. Jimenez, Esq.

Managing Attorney and Founder


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