Bankruptcy's Impact on Divorce and the Best Time to File

Feature Article: The Intersection of Bankruptcy and Divorce

Divorce and bankruptcy are two of the most stressful experiences an individual can endure. When combined, they can create a complicated and emotional web that is hard to unravel. In this article, we will explore how bankruptcy impacts divorce and when it might be appropriate to file joint bankruptcy before divorce proceedings begin.

Can Bankruptcy Save You Money in a Divorce?

Many couples going through a divorce are faced with a significant amount of debt that they must divide during the property settlement process. Depending on the circumstances, filing for bankruptcy before or during a divorce could help reduce the number of debts that must be divided.

Filing for bankruptcy jointly before a divorce can save money on filing fees and attorney costs. When filing jointly, you only need to pay once for a joint bankruptcy petition, as opposed to paying separate filing fees for individual bankruptcies. Jointly held debts, such as credit cards or medical bills, can also be discharged together, simplifying the divorce process.

Combined household income might qualify you for Chapter 7 bankruptcy, which typically discharges unsecured debts within 4-6 months. By discharging unsecured debts, the couple has fewer liabilities to divide during the divorce process.

The Impact of Automatic Stay on Divorce Proceedings

The automatic stay is a powerful tool in bankruptcy that temporarily halts all creditor collection actions, including a divorce proceeding involving assets in which both parties have a community interest. However, an automatic stay can also delay divorce proceedings, especially if marital assets are involved.

If a divorce proceeding is pending and one spouse files for bankruptcy, the automatic stay could stop the divorce proceeding until the bankruptcy is resolved. Depending on the timing of the bankruptcy, the division of assets may have to wait until the bankruptcy process concludes.

Furthermore, the bankruptcy trustee is primarily concerned with identifying assets to satisfy the debtor's outstanding obligations, rather than dividing assets based on community property laws. This means that the trustee may have control over the property division and could sell some or all of the property to satisfy creditors.

The Emotional Toll of Joint Bankruptcy During Divorce

Filing for bankruptcy can be overwhelming and emotionally taxing, particularly when divorce proceedings are also in progress. It can add additional stress to an already challenging situation.

One of the primary concerns of joint bankruptcy proceedings during an already strained marriage is the emotional toll that it can take on the individuals involved. The added stress of managing legal and financial matters during emotional turmoil can lead to increased tension and resentment between spouses.

It's essential to weigh the benefits and risks of filing for bankruptcy before or during a divorce, taking into account the unique circumstances of each case.

When Should You Consider Filing for Joint Bankruptcy?

There is no one-size-fits-all answer for when a couple should consider filing for joint bankruptcy. However, if you and your spouse are considering divorce and also facing significant debt, it's worth discussing the pros and cons of joint bankruptcy with a bankruptcy attorney.

If you're struggling to pay your debts, filing for bankruptcy can provide relief by discharging unsecured debts and stopping creditor collection actions. You may save time and money by filing jointly before divorce proceedings begin, rather than filing separately later.

However, it's crucial to remember that filing for bankruptcy can have long-term consequences, such as damaging your credit report and limiting access to credit. It's essential to work with an experienced bankruptcy attorney to explore your options and develop a personalized bankruptcy strategy that aligns with your goals.


Bankruptcy and divorce are both significant life events that can be stressful and emotionally draining. By understanding how bankruptcy impacts divorce proceedings, you can make informed decisions about when to file for bankruptcy and how to navigate the legal and emotional complexities of divorce.

If you're considering filing for joint bankruptcy before or during a divorce, it's important to consult with an experienced bankruptcy attorney. With the right legal guidance and support, you can emerge from bankruptcy and divorce with a fresh start and a brighter future.

Bankruptcy, Filing-CHM Law