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HUNTSVILLE AND DECATUR AL BANKRUPTCY AND DIVORCE LAWYERS
Bankruptcy and Divorce Attorneys Near Me
Financial problems often go hand in hand with divorce and family problems. Financial problems create a strain on marriages. Further, after couples divorce, it can be difficult to pay your bills and adjust to living on one income. It is not uncommon for recently divorced people to consider starting over by filing for bankruptcy. If you are considering bankruptcy and divorce, we can help. Call 256-534-3435 now. If you are facing overwhelming debt because of a divorce and want to get control of your finances, talk to one of our Huntsville bankruptcy attorneys today. We offer free consultations. During your consultation, we will discuss your situation and advise you on whether filing for bankruptcy is best for you. When bankruptcy and divorce occur at the same time, there may be conflicting legal issues and questions, such as:- Can my spouse and I jointly file for bankruptcy while we are divorcing?
- How are joint debts separated if I file for bankruptcy and my spouse does not?
- If I file for bankruptcy, do I still need to pay child support?
- Are spousal support obligations discharged in bankruptcy?
- My home is facing foreclosure. Will we lose our equity in our divorce?
Bankruptcy and Divorce Frequently Asked Questions
The following answers provide general information about bankruptcy and divorce in Alabama. Every case is different, and you should speak with an attorney about your specific circumstances.
Can my spouse and I jointly file for bankruptcy while we are divorcing?
A married couple may generally file a joint bankruptcy case while they remain legally married. Whether a joint filing is advisable during a divorce depends on the spouses’ debts, income, property, ability to cooperate, and the timing of the divorce. Separate bankruptcy and divorce advice should be obtained before filing.
Should bankruptcy be filed before or after divorce?
The best timing depends on the couple’s income, property, joint debts, support obligations, and ability to cooperate. Filing before divorce may address joint debts together, while filing after divorce may allow each former spouse to address debts separately. An attorney should review both proceedings before a decision is made.
What happens to joint debts if I file for bankruptcy and my spouse does not?
A bankruptcy discharge may eliminate the filing spouse’s personal liability for certain dischargeable debts, but it ordinarily does not eliminate the nonfiling spouse’s liability on a joint account. The creditor may still pursue a spouse or former spouse who remains contractually responsible for the debt.
Does a divorce decree prevent a creditor from collecting a joint debt from me?
Not necessarily. A divorce judgment may assign responsibility for a debt between former spouses, but it generally does not change the creditor’s original contract. A creditor may still seek payment from anyone whose name remains legally obligated on the account.
Can child support be discharged in bankruptcy?
No. Child support is generally treated as a domestic support obligation and is not discharged in Chapter 7 or Chapter 13 bankruptcy. Filing bankruptcy also does not eliminate the obligation to remain current on required support payments.
Can alimony or spousal support be discharged in bankruptcy?
Domestic support obligations such as alimony or spousal support are generally not dischargeable in bankruptcy. The legal treatment of other divorce-related obligations may depend on the language and purpose of the obligation.
Does the bankruptcy automatic stay stop a divorce case?
The automatic stay may pause certain divorce-related proceedings involving property of the bankruptcy estate, but it does not necessarily stop every part of a divorce case. Proceedings involving establishment of support, custody, or dissolution of the marriage may be treated differently.
How does bankruptcy affect property division in a divorce?
A bankruptcy filing may affect whether marital property can be transferred or divided because some property may become part of the bankruptcy estate. The bankruptcy trustee, exemptions, liens, and the timing of both cases may influence what happens to the property.
What happens to our house if bankruptcy and divorce occur at the same time?
The result depends on the home’s value, mortgage balance, ownership, available exemptions, payment status, and the type of bankruptcy filed. Bankruptcy may temporarily stop foreclosure, but the automatic stay does not permanently eliminate a valid mortgage lien.
Can bankruptcy stop foreclosure while a divorce is pending?
A bankruptcy filing usually creates an automatic stay that can temporarily stop many foreclosure actions. The lender may seek permission to proceed, and continued protection may depend on the bankruptcy chapter, available income, and whether required payments are made.
Can one spouse file bankruptcy without the other spouse?
Yes. A married person may generally file an individual bankruptcy case without the other spouse filing. The nonfiling spouse’s income, joint property, and joint debts may still need to be disclosed or considered.
Will my spouse’s bankruptcy ruin my credit?
A spouse’s individual bankruptcy should not be reported as the nonfiling spouse’s bankruptcy. However, missed payments or defaults on joint accounts may affect both spouses’ credit histories, and the nonfiling spouse may remain responsible for joint debts.
Can a former spouse file bankruptcy to avoid obligations in a divorce decree?
Some divorce-related debts may be affected by bankruptcy, but domestic support obligations are generally not dischargeable. Whether another obligation can be discharged depends on its legal character, the bankruptcy chapter, and the facts of the case.
Are attorney fees awarded in a divorce dischargeable in bankruptcy?
The treatment of divorce-related attorney fees depends on why the fees were awarded and whether they are considered support or another type of domestic obligation. The divorce order and applicable bankruptcy law should be reviewed by an attorney.
What documents should I bring to a bankruptcy and divorce consultation?
Helpful documents include the divorce complaint or judgment, separation agreement, support orders, recent tax returns, pay records, bank statements, mortgage information, vehicle loan statements, retirement account statements, and a complete list of debts and assets.
Does Ferguson & Ferguson offer free bankruptcy and divorce consultations?
Yes. Ferguson & Ferguson offers free consultations for people considering bankruptcy or dealing with bankruptcy and divorce issues. The Huntsville office can be reached at 256-534-3435, and the Decatur office can be reached at 256-350-7200.
Where are Ferguson & Ferguson’s bankruptcy and divorce offices located?
The Huntsville office is located at 303 Williams Avenue SW, Suite 321, Huntsville, Alabama 35801. The Decatur office is located at 211 Oak Street NE, Decatur, Alabama 35601.