Divorce is incredibly challenging for most, if not all, who go through it. Coupled with another problem, such as bankruptcy, the complexity and stress compound an already emotionally charged situation. If one or both you and your spouse need to file for bankruptcy while going through a divorce, you need to consider the timing and conditions of both to make sure that your rights, vital assets, and interests are protected.

We, at The Peterson Law Firm, understand the intricacies of both divorce and bankruptcy and are here to guide you through these intricate processes. The strain of marital dissolution coupled with mounting debt can be overwhelming. It is important to understand how these two processes intertwine and impact each other.

How Does Bankruptcy Affect Divorce?

Filing for bankruptcy can impact the division of assets, spousal support, and child support arrangements. Additionally, it can affect the handling of joint debts acquired during the marriage. Understanding the implications of chapter 7 or chapter 13 on divorce is essential for making informed decisions and ensuring your rights are protected.

If I File for Bankruptcy During a Divorce, What Happens?

The effects of bankruptcy during divorce can vary depending on the type of bankruptcy filed. Let’s explore the implications of Chapter 7 and Chapter 13 bankruptcy on the divorce process:

Chapter 7 and Divorce:

Chapter 7 bankruptcy, also known as liquidation bankruptcy, involves the sale of non-exempt assets to repay debts. In the context of divorce, filing for Chapter 7 can temporarily pause the division of assets. The courts will appoint a trustee who will determine which assets are exempt and which may be sold to satisfy creditors. It is important to note that certain debts, such as child support and alimony, cannot be discharged through Chapter 7 bankruptcy.

Chapter 13 and Divorce:

Chapter 13 bankruptcy, commonly referred to as reorganization bankruptcy, involves creating a repayment plan to settle debts over three to five years. If you file for Chapter 13 during a divorce, the repayment plan may impact the distribution of marital assets and the calculation of support payments. Both the divorce court and the bankruptcy court must coordinate to address the complex interplay between these two processes.

What Happens to Joint Debt if You File for Bankruptcy?

Joint debt acquired during a marriage can be a significant concern when facing bankruptcy and divorce. When one spouse files for bankruptcy, the other spouse may become solely responsible for the joint debts. The non-filing spouse may need to consider alternative debt management options to protect their financial well-being. It is crucial to consult with an experienced attorney who can provide guidance tailored to your specific circumstances.

What Happens to Joint Assets if You File for Bankruptcy?

The fate of joint assets in bankruptcy proceedings depends on various factors, including the type of bankruptcy filed and the exemptions available. In Chapter 7 bankruptcy, non-exempt joint assets may be subject to liquidation to satisfy creditors. However, exemptions provided by the bankruptcy laws can protect certain assets from being sold. In Chapter 13 bankruptcy, joint assets are typically retained as long as the repayment plan is adhered to. Proper understanding of exemptions and the guidance of a skilled attorney are vital for protecting your interests.

Steps to Protect Yourself from Future Bankruptcy and Divorce

While navigating the complexities of bankruptcy and divorce, it is essential to take proactive steps to safeguard your financial future. Consider the following measures:

  • Seek Professional Guidance: Consult with experienced attorneys who specialize in both divorce and bankruptcy law. They can provide comprehensive advice tailored to your unique circumstances, ensuring that your rights and interests are protected.
  • Prioritize Financial Planning: Develop a comprehensive financial plan with the help of financial advisors who understand both divorce and bankruptcy. Create a budget, explore debt management strategies, and set achievable goals for post-divorce and bankruptcy recovery.
  • Communicate Effectively: Open and respectful communication with your spouse throughout the process is vital. Seek amicable solutions whenever possible, as protracted legal battles can escalate costs and stress.

Protect Your Rights with The Peterson Law Firm

When faced with the intersection of divorce and bankruptcy, it is crucial to have a trusted legal partner by your side. At The Peterson Law Firm, our dedicated attorneys specialize in both divorce and bankruptcy matters. We possess the knowledge, experience, and empathy necessary to guide you through these complex processes.

If you find yourself grappling with divorce and bankruptcy simultaneously, we urge you to contact The Peterson Law Firm for personalized guidance and support. Our compassionate team is here to provide you with the legal advice and assistance you need to navigate these challenging circumstances successfully.

Remember, divorce and bankruptcy may present obstacles, but with the right support, you can pave the way for a brighter future. Take the first step by contacting us today.


We value each and every one of our clients, employees, friends, and neighbors. Together, we have a social responsibility as a community partner to take proactive measures to keep our community well and to help stop the spread of COVID-19.

Our office will remain open during regular business hours. However, we are implementing some additional precautions to limit social interactions and personal proximity. Specifically, we will seek to conduct consultations, meetings, conferences through video teleconferencing or on the phone whenever possible. Should an in-person appointment be needed, then we will coordinate those on an appointment basis.

If you have questions about your case and the status of the court, then please call. Our Firm will continually monitor the status of the coronavirus, so we are prepared to resume normal operations as quickly as possible.

From all of us at The Peterson Law Firm, please stay well.