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Divorcing when struggling with debt

On Behalf of | Jul 26, 2018 | Divorce

Many a Pennsylvania couple has found themselves headed for divorce and struggling with serious piles of debt at the same time. In fact, it is well-known that financial problems often contribute to marital struggles and even to some divorces. If you are in this situation, you might even be wondering if you and your spouse should file for bankruptcy before you get divorced. The answer to this question may depend on several different factors.

As explained by NerdWallet, if you and your spouse either individually or collectively think your financial situation warrants a bankruptcy, you will want to first assess what type of bankruptcy plan is most appropriate for your situation. If you do not own a home and the bulk of your debt is unsecured, meaning it is not attached to collateral, you might be able to consider a Chapter 7 bankruptcy. If, however, you own a home and want to avoid losing it in a bankruptcy, you might be better served by a Chapter 13 bankruptcy.

You should know that Chapter 13 plans last for several years so if this plan might be right for your needs, you may want to consider getting divorced first lest you and your spouse be forced to stay connected for the duration of the plan or pay extra money if you get divorced in the midst of the bankruptcy.

If you would like to learn more about how you might best manage a potential bankruptcy and a divorce happening at or near the same time, please feel free to visit the debt and marital dissolution page of our Pennsylvania family law website.

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