# Divorce and Bankruptcy, which first?



## JohnSebastian (Dec 24, 2013)

Hi, new here, no my name is not John, aka. 

We might be getting divorced, I'll probably post my story separately when there is more time. If we do divorce, we can't keep the house and the credit cards become a problem too. We'll have to rent two places. I'm actually thinking it might have to be Chapter 7. We have 3 kids 15-17 1/2, we'll live near each other and they can have bedrooms in both places. What's the best way to handle divorce and bk if it happens? 

I was thinking maybe stop paying the mortgage, save money, rent two places, divy up stuff, file BK, then file divorce. Is this a proper plan? Thanks for your help.


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## Daisy2714 (Sep 22, 2013)

Hello John.

There isn't much to go on regarding the info you have given. Let me start by saying how sorry I am that you find yourself in this place both emotionally and financially. 

Having said that, I have to ask for more info before I can try to help but I will do the best I can. 

I would ask you how familiar are you with BK? For instance, do you know absolutely for certain that you qualify for a Chapt 7? If not, you may get forced into a chapt 13. That makes a huge difference in the advice I would give to you. 

Also, how willing is your wife going to be as a part of your plan? Is she on board with filing BK? If she isn't, that is also something you will have to reckon with. 

If you could give us more details it would help us to help you. Filing BK is not a little thing. There is a lot to it regardless of which chapt you file for. Throw a divorce into the mix and it gets really complicated. 

Take a breath. Enjoy your family and the holiday season as much as you are able. Then come back and help us help you.

Best regards,
Daisy


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## honcho (Oct 5, 2013)

You would most likely be better off doing the bankruptcy first then getting divorced. Especially if you know you are going to have to file for bankruptcy it would be far too easy to divorce, have one spouse accept all the debt in the divorce then file for bankruptcy to erase the debt. 

The bankruptcy court would look at that and not accept the bankruptcy or I have seen where they will chase the now ex-spouse for the liabilities. Divorce court and bankruptcy court are very different and follow different rules and regs and neither really cares what the other orders. Its just part of the ridiculous system we have in place. 

It makes a complicated mess out of both cases. If you know you are going to have to lose the homestead, you will most likely have much better luck discussing the situation with bank and just put the house up for sale. Most likely it would be a short sale but the bank may be willing to go to interest only payments or even suspend payments all together till it sells. They don’t want to mess with a bankruptcy anymore than you do. Credit card companies are the same, they have no collateral to chase so they will many times take an offer to settle the debt. There are various options to pursue before bankrupty. Most financial institutions go with the getting something is better than nothing theory


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## JohnSebastian (Dec 24, 2013)

Well, if things pan out the way they might, I don't want to continue making mortgage payments and live with her. So I think if it happens, we should contact the bank for the short sale, stop payment, and then rent two places. Then once we've moved into our respective places, then make a financial plan. I want to make it as "painless" as possible if we can. For the kids sake.


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## unbelievable (Aug 20, 2010)

Divorce now, you both need three bedroom apartments. If you can hold off 3 years, the kids will be adults. Presumably, you both could get by on 1 bedroom apartments each or these young adults could help pay rent. I'd take advantage of my unhappiness and take a high-paying gig overseas or in the oil fields for three years. Without the stress of three teenagers, you might find your financial and relationship issues aren't insurmountable. If you want painless for the kids, that keeps them in their primary home until they move out on their own terms.


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## JohnSebastian (Dec 24, 2013)

Well, I prefer not to divorce, but I'll do it in a heartbeat if things don't get fixed. I don't believe we can stay together long with the current situation if there is no progress. I posted my story in the mental health sub forum if you are interested. Thanks.


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## Zanne (Dec 7, 2012)

I have a friend who is in the process of a divorce and custody battle. He was advised by his attorney to file bankruptcy first, which he did, but it took some doing as his STBXW was not very cooperative and delayed the filing for months.

Also, you may want to consult a bankruptcy attorney to see if you are eligible. The laws are much stricter now on who can file. Best of luck to you.


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## JohnSebastian (Dec 24, 2013)

One question though. Would it be wise to move to separate homes before filing bk?


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## PBear (Nov 16, 2010)

You really should be getting professional advice from someone who knows your actual situation. Not just random people on the Internet. 

C


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## JohnSebastian (Dec 24, 2013)

Well, if people here have filed bk and divorce at the same time, it would be useful to know how they went about it.


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## unbelievable (Aug 20, 2010)

If I promise someone I'm going to pay a bill, I feel a moral obligation to pay it as agreed. Barring some disability that rendered me incapable of fulfilling that obligation, they would get paid. I would not feel right deliberately putting myself in a position where I could not pay them, even if it meant me dealing with an unpleasant relationship. If hanging with the old lady was that unpleasant, I'd probably take a second job locally or a high paying gig elsewhere. Either choice would fix the economic problem and it would put distance between me and a woman I couldn't get along with. My completely innocent creditors shouldn't bear loss because I couldn't keep my marriage together. That's just my thought process on the topic. I believe I could figure out an honorable way to extricate myself from a bad situation.


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## JohnSebastian (Dec 24, 2013)

Sure. Bk is the last option. But I want to know how people have gone about it, just in case. I am reading everything I can on fixing relationships, ending them when needs aren't met, bk, divorce, blah, blah, blah. I'm an engineer by trade. We are obsessed with knowledge.


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## honcho (Oct 5, 2013)

I read your other posts about your marriage and I am sorry you are in the position that you are in. Given the length of your marriage, children you can expect both alimony and child support. Your wifes work situation doesn’t sound pleasant which is contributing to all the problems. Some of your comments on the other post sounds like she is trying to become a 21 year old again. She could very well quit her job as part of her running from responsibility which will lead to further headaches for you.

Your going to need to spend some cash on an attorney to get the best answers for your situation. I had to help my mom with her bankruptcy right after she divorced my father. He passed away shortly after the divorce so the alimony had stopped but they should have done the bankruptcy before the divorce. Doing the bankruptcy at all was about the dumbest thing my mom tried to do after the divorce. My brother and I had to buy the grandfathers home which my mom was living in because she had inherited the home. While married the property was untouchable during bankruptcy because it was inherited and they had a primary residence it couldn’t be touched in divorce because of inheritance. After divorce and my parents losing the primary residence the old farmstead became her primary home but she then lost the inheritance exemption thus making it fair game to a bankrupty court. It was a mess and complicated to explain. Long story short it cost me and my brother a bunch of cash when it would have cost nothing had they done it right. 

Bankruptcy court is much more stringent than divorce court and every dollar spent has to be approved by court. From a bankruptcy court standpoint they most likely wont allow you to set up two separate household, then try to dump your current house. They will look at it as if you can afford two places you can afford the house. Even if you stopped paying on the homestead tomorrow getting you out via foreclosure will take a great deal of time. If you filed for divorce tomorrow, your spouse could claim it as her primary homestead and you could be stuck paying for it for as long as a temp order is in place which could take a year or longer. 

A good lawyer is your best for the answers because doing it the wrong way can cost you a great deal of money. You will probably need to speak to two lawyers, one for each specialty and have them talk together because each has much different rules to keep the court system happy.


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## JohnSebastian (Dec 24, 2013)

Thanks Honcho. That's the sort of thing I wanted to learn.


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