It is not entirely uncommon for bankruptcy and divorce in Watertown, NY, to occur at the same time. However, when this is the case, you need to have a thorough understanding of how bankruptcy and divorce impact each other and which one you should file for first.
At Grady BK, PLLC, our goal is to provide our Watertown clients with the legal guidance they need as they navigate bankruptcy during divorce in New York. We will help you evaluate your options to determine the best bankruptcy timing with divorce so that both cases can move forward smoothly. In this article, we will be discussing the complexities of bankruptcy and divorce in Watertown, NY, and the pros and cons associated with the different filing timelines.
Understanding the Legal Relationship Between Bankruptcy and Divorce
Before we even touch on the topic of bankruptcy, you need to understand how property is handled in New York divorce cases. The state of New York follows the principle of equitable distribution, which divides property on the basis of fairness. This can impact bankruptcy proceedings depending on the types of individual and marital assets as well as whether or not there are any children involved.
When a divorce decree takes effect before bankruptcy proceedings, anything in the decree will be considered legally binding. For instance, if your spouse got the house in the divorce, this will usually protect it from bankruptcy proceedings. Additionally, marital obligations, such as spouse or child support, will be included in your Chapter 13 repayment plan or will be labeled as a non-dischargeable debt in Chapter 7 bankruptcy.
Keep in mind that how your case looks when you combine bankruptcy and divorce will be very different depending on your personal situation. That is why it is essential that you hire a bankruptcy attorney to protect your rights and help you achieve a better financial future.
Filing For Bankruptcy and Divorce: Which to File First
Should you file bankruptcy before divorce in Watertown, New York? If you are asking this question, you should know that there is no law dictating which has to come first. Because of this, you need to evaluate your options to decide whether or not joint bankruptcy in Watertown, NY, is preferable or if you should simply proceed with bankruptcy after your divorce.
Here is an overview of the pros and cons of both options for Watertown residents.
Filing Bankruptcy Before Divorce: Pros and Cons
In many instances, filing for bankruptcy before divorce can create a much easier process. This is because you will have joint bankruptcy filing benefits and will be able to discharge joint debt before marital division. You will also only have to pay one bankruptcy filing fee.
However, the downside to this is that it is not a good option if you are planning to file for Chapter 13 bankruptcy as this is a repayment plan type of bankruptcy. You may also find it too difficult to file jointly due to different living circumstances, strained communication, etc.
Filing Divorce Before Bankruptcy: Pros and Cons
Generally, going through a divorce before bankruptcy proceedings is the best option if the relationship is strained. Doing this individually can also help if you want to file for Chapter 7 since filing jointly may put you over the income limit.
Keep in mind that bankruptcy proceedings after a divorce can become a bit more complex depending on your divorce decree. Your case will be examined more closely to ensure there is no fraud, especially when it comes to transfers of valuable property in the divorce.
Tips For Navigating Divorce and Bankruptcy in Watertown, NY
Now that you know the complexities of family law and bankruptcy in NY, here are some tips to help you navigate both situations at once:
- Hire an attorney: Possibly the most important thing you need to do if you are getting a divorce and declaring bankruptcy is to get legal representation. Ideally, you should be working with both a divorce attorney and a bankruptcy attorney, as divorce and bankruptcy laws are very different and require expert knowledge to navigate.
- Avoid delays: When navigating both divorce and bankruptcy, it is important to tackle both situations head-on. Especially if you are finalizing a divorce, you do not want to delay bankruptcy proceedings, as any recent asset transfers can be seen as more suspicious.
- Be legally compliant: Throughout every step of the bankruptcy and divorce process, you need to ensure you are being legally compliant. Especially since divorce often results in asset transfers, you need to ensure this is done legally and is included in the divorce decree to avoid being falsely accused of fraud.
FAQ:
Can I file bankruptcy jointly after divorce?
No, it is not possible to file for bankruptcy jointly after you have already gone through a divorce since you will no longer qualify for legal married status.
Does bankruptcy wipe out child support or alimony in Watertown, NY?
No, child support and alimony are protected by federal bankruptcy law and are considered to be non-dischargeable debts. So, they will continue to be your responsibility even after you have filed for bankruptcy.
Watertown’s Top Compassionate Bankruptcy Attorney
Understanding how divorce affects bankruptcy filing can be very complicated, which is why you need to seek the legal help of a bankruptcy attorney. At Grady BK, PLLC, we will help to break down the bankruptcy process so that you have a complete understanding of how it will impact your divorce proceedings. We can help you determine whether or not you should file for bankruptcy or divorce first and the pros and cons of both options.
At Grady BK, PLLC, we strive to provide a personalized approach so that each and every one of our clients feel as though they are our only client. We will provide clarity and transparency so that the bankruptcy process doesn’t feel as overwhelming or complicated.
Contact us today at 315-299-9005 to discuss your financial situation with a Watertown bankruptcy attorney. Our team at Grady BK, PLLC, is here to help you as you navigate both bankruptcy and divorce in Watertown, NY.
