${site.data.firmName}${SEMFirmNameAlt} ${site.data.firmName}${SEMFirmNameAlt}

Facing a family law issue? We can helpSchedule an initial consultation

Phone 954-800-5000
Toll Free 800-642-8160

Should you file for divorce or bankruptcy first?

People in Florida getting a divorce might be wondering which they should file first: divorce or bankruptcy? According to divorce experts, it is wise for couples to resolve as many issues as they possibly can before they file for a divorce. This is especially true for couples who have mortgage payments.

The first step that couples should take is to find out who is liable for any mortgage payment. Then, they should determine whether or not they live in an anti-deficiency state, as this will directly affect their property division. Anti-deficiency states are those states that do not hold people responsible for deficiencies on any properties that they occupied as their primary residences. The deficiency is the difference between what is owed on a property and what the property sells for in a foreclosure auction.

After that, then couples should file for bankruptcy. They might be liable for the deficiency on their mortgages, and they might have other unsecured debts as well. Filing for Chapter 7 bankruptcy will allow them to wipe out their liability on their mortgages and other dischargeable debts. Then, after they have filed for bankruptcy, they should file for divorce. However, couples should beware because although their bankruptcy has wiped out their liability for certain debts, they can still re-establish liability in their divorce settlements. People should exercise caution to ensure that they don't agree to be responsible for a certain debt as a condition of their divorce agreements.

Divorce attorneys might be able to assist people who are getting divorces and want to file bankruptcy as well in completing the process in the order that is most appropriate for their individual cases. Divorce attorneys might also help couples resolve issues such as child custody, child support and alimony.

Source: Fox Business, "Which Should I File First: Divorce or Bankruptcy?", Justin Harelik, July 10, 2013