Bankruptcy and Divorce: Learn How the Two Affect Each Other
Posted on: May 25, 2018
Is there anything that makes a divorce or other family law issues more complicated than one spouse filing for divorce? No matter which party files for divorce, it does add a wrinkle to the process. It’s entirely possible that if you’re not both working with a family law attorney, you could end up violating bankruptcy rules and / or rules of the Family Code.
If you break a bankruptcy law, then you could be looking at losing tens of thousands of dollars via sanctions. In the event that you disobey a Family Code, you could end up with a sanction or something much worse. The best way to avoid this situation is to contact Kendall Gkikas & Mitchell, LLP at 909-482-1422 right away.
What happens to child support, spousal support, and other payments when a person files for bankruptcy?
Generally speaking, things that fall under the frame of “nature of support” aren’t dischargeable. This may include alimony, child support, the debts that are outlined within the divorce agreement, money used for food, transportation, shelter, etc. The tricky aspect of this is that what is considered within the “nature of support” is not explicitly spelled out and is instead up to the discretion of the judge.
For example, while it may be easy to show that child support and alimony should be protected from being discharged, what about debt caused by the fees for an attorney to get those orders in the first place? Would the bankruptcy judge consider them to be “nature of support?” They may or they may not.
The effect of an automatic stay on actions and garnishments
If you have a wage assignment on your former spouse and they file for bankruptcy, then you may be worried about what will happen to the funds you’re entitled to. Do you have to stop the garnishments in place? Or what if you’re taking a different enforcement action against them, are you bound by the bankruptcy’s “automatic stay” that’s supposed to apply to all creditors?
You may be, but there are also exceptions. It all depends on when the bankruptcy was filed with the bankruptcy court, what type of bankruptcy was filed, and the type of enforcement action you’re taking or plan to take. A specific answer can’t be given without more specific information so feel free to contact Kendall Gkikas & Mitchell, LLP at 909-482-1422 to give us more details so we can provide the personalized attention you need.
There’s no time like right now to talk to an attorney who can help
The fact of the matter is that if you’re dealing with a divorce and / or bankruptcy, you are likely feeling as though you’re in over your head. We know how frustrating this can be but the good news is that you do have access to a qualified professional who can help you through this. Contact Kendall Gkikas & Mitchell, LLP at 909-482-1422 to set up a consultation.