What do I Need to Know if my Spouse Files for Bankruptcy During our Divorce?

Divorce and bankruptcy are two impactful experiences that people can go through in their life. In some cases, they can occur at the same time. When facing divorce proceedings, there are many spouses who need to file for bankruptcy. This can cause certain complications for all parties included. During this time, it is important to know what to expect out of your proceedings and how it affects each spouse. Continue reading below and contact an experienced New Jersey divorce attorney for assistance.

What Happens When Bankruptcy is Filed During a Pending Divorce?

When dealing with bankruptcy, it is important to know some of the fundamental concepts, such as the “automatic stay.” This goes into effect immediately when a person files for any type of bankruptcy. This can be of assistance to the debtor, as it prevents collection activities from taking place as well as puts other legal proceedings on hold. This can include divorce proceedings. While this can help the spouse who owes certain debts, it can cause issues for the other spouse. 

How Can Bankruptcy During a Divorce Impact Me?

Another part of bankruptcy to know about is dischargeable debts. The debts that can be discharged in a bankruptcy case can vary depending on the case. When bankruptcy takes place during a divorce, there are usually similar requests to discharge claims of alimony, child support, or property settlements. However, the decision is up to the bankruptcy judge in charge of the case. While this is true, the following are rules that generally apply in most cases:

  • Claims for alimony generally cannot be discharged in a bankruptcy proceeding
  • Claims for child support generally cannot be discharged in a bankruptcy proceeding
  • Claims for property settlements may generally be discharged in a bankruptcy proceeding if the divorce judgement has not been finalized

Contact our Firm

If you require strong legal representation for matters of divorce and family law in New Jersey, contact The Law Offices of Paone, Zaleski & Murphy to schedule a consultation with one of our experienced attorneys today.