There is no doubt of the emotional impact when considering a divorce. Couple this with financial issues and your level of stress can fly off the charts. Considering money issues are often a leading factor in divorce, it isn’t surprising so many Wisconsin residents end up wondering which to file first: divorce or bankruptcy.
The good news (and the challenge) is this: if you and your spouse are able to have a calm and focused conversation about the timing of these two very significant events, you can potentially save yourselves a lot of money and frustration later.
This article will offer a number of things to consider when determining if it’s better to file for divorce or bankruptcy first in Wisconsin.
If you would like to learn more about the subject of bankruptcy, specifically in the state of Wisconsin, the following articles by The Fitzgerald Law Firm provide important information:
- “4 Things to Know Before Handling a Personal Bankruptcy During a Divorce”
- “How to Choose the Right Type of Bankruptcy in Wisconsin”
- “When Can I Buy Property After Filing for Bankruptcy in Wisconsin”
Before Filing for Divorce in Wisconsin, Discuss Your Finances
In determining your best options heading into a divorce, it is important the two of you first gain a thorough understanding of your joint finances. As difficult as it can be during tumultuous and emotional times, it important to come together to have an honest discussion about the following:
- Finances–including debt
You may come to realize a bankruptcy filing might be beneficial to both of you as you move on to make fresh starts.
Timing is also important. This is a very important conversation you and your spouse need to have before filing for divorce. By working together to address your finances before a divorce, you could greatly improve your financial future, reduce bankruptcy costs and may even save money later on your divorce.
To gain a better understanding of your options as you consider divorce and bankruptcy in Wisconsin, contact a qualified and experienced attorney to help you plan for your future.
Does it Matter Which We Do First: File for Bankruptcy or Divorce?
If you are ready to file for bankruptcy and divorce at the same time in Wisconsin, it absolutely can make a big impact on your finances which you choose to file first.
While there is no blanket answer recommending, “File Chapter 7 before divorce” or “File for divorce before bankruptcy,” there are 4 factors which are important to consider before making your decision and which you will want to discuss with your bankruptcy attorney:
- Where you reside
- How much property you won
- How much debt you have
- Which type of bankruptcy you plan to file
All of these factors will influence whether it is best for you to file bankruptcy before divorce or divorce before bankruptcy in Wisconsin.
Both divorce and bankruptcy in Wisconsin can be complicated matters. Regardless of your timing, it is important you choose to work with a knowledgeable attorney who is experienced in both types of cases.
When to File for Bankruptcy Before Divorce in Wisconsin
The answer to this question really depends on your specific situation and needs, and is best made with the assistance of an attorney experienced in handling both bankruptcy and divorce.
There are a number of reasons you might choose to file for bankruptcy jointly before divorce in Wisconsin. Some of those reasons include:
- Release debt jointly prior to divorce
- Address debt in one bankruptcy filing, saving money and frustration later
- Possibility of increasing your bankruptcy exemptions
- You may qualify for Chapter 7 before divorce if one spouse is the primary earner
- Eliminate contracts moving forward which include you both (car loans, mortgage loans, etc.)
By simplifying issues like debt and property division through bankruptcy prior to filing for divorce, you can potentially save time and money later.
Understandably, this can be more than challenging for two people preparing to end a marriage. As difficult as it may be, it is crucial you and your spouse discuss your finances prior to filing for divorce to help ensure the best end result for both of you.
In planning which course of action to pursue first, contact a lawyer experienced in both bankruptcy and divorce in Wisconsin to help you explore your options.
Contact an attorney specializing in bankruptcy to discuss the details of your situation to help determine if you should file for divorce before bankruptcy in Wisconsin.
When to File for Divorce Before Bankruptcy in Wisconsin
Again, deciding whether you should file for divorce before filing for bankruptcy depends on your specific situation and whether you plan to file for Chapter 7 or Chapter 13 bankruptcy in Wisconsin.
If you hope to qualify for Chapter 7 bankruptcy, but your joint incomes disqualify you from debt forgiveness, it may serve to your advantage to file for divorce first so that your incomes are considered on an individual basis, increasing your ability to qualify for Chapter 7 debt relief.
If Chapter 13 is the right choice for you, you may want to file for divorce first so that you can file for Chapter 13 individually later. While Chapter 7 bankruptcies are resolved fairly quickly (typically 9 months), Chapter 13 bankruptcy payment schedules can take 3-5 years. Few divorced couples want to remain financially linked for such a long period of time after a divorce.
Property is another reason you might consider filing for divorce prior to bankruptcy. If you own a lot of property and will not be able to adequately increase your exemptions with your bankruptcy, you might consider filing for divorce first to allow you to file for bankruptcy individually later.
There are numerous factors and situations which need to be looked at in detail prior to making a decision about whether to file for divorce prior to bankruptcy. Do yourself the favor of discussing these matters with a proven bankruptcy attorney.
If your spouse has recently filed individually for bankruptcy and you are also planning to file for divorce, it is crucial you contact an experienced bankruptcy attorney immediately to avoid being held responsible for your spouse’s share of any joint debt.
FREE 15-Minute Consultation
The Fitzgerald Law Firm is pleased to make available to you at no obligation a FREE 15-minute consultation to discuss your specific situation and help explore your best path of action in filing for bankruptcy and/or divorce in Wisconsin.