Bankruptcy in Divorce
When viewing your debt obligations contained in a divorce decree, you may be able to discharge your liability to your creditors, because they will never know that your obligations were contained in a divorce decree, but your liability to your ex-spouse will never go away. If you and your soon-to-be ex-spouse have a great deal of debt, it is best for you both to file bankruptcy and get rid of all of it, if possible.
The specific section of the bankruptcy code at issue is 523(a)(15) of the United States Code. The specific language is contained here for your convenience:
(15) to a spouse, former spouse, or child of the debtor and not of the kind described in paragraph (5) that is incurred by the debtor in the course of a divorce or separation or in connection with a separation agreement, divorce decree or other order of a court of record, or a determination made in accordance with State or territorial law by a governmental unit;
If you have questions about the application of this section to your divorce, please call or email us. If you and your soon-to-be ex-spouse can put aside your differences regarding some issues of your divorce it is possible that both parties can benefit in the form of reduced debt or even an increase in child support or alimony.