Bankruptcy Considerations During Divorce [creditcardsbusiness]

Bankruptcy Considerations During Divorce [creditcardsbusiness]

Bringing credit cards to a zero balance before filing bankruptcy may complicate the process. ... Once the company receives notification that you filed bankruptcy, all accounts under your Social Security number are flagged and closed. The account can ... Pay Off Credit Cards Before Bankruptcy?

www.Savedme.com 800-728-3363 800-SAVEDME. Bankruptcy Attorney Jamie Ryke from the Law Offices of www.FreeBankruptcyEvaluation.com Southfield, Michigan and Chicago Illinois talks about what happens to your credit score when you file for Chapter 7 or Chapter 13 bankruptcies.

http://summershot.net/ What happens to your credit score when filing bankruptcy

Certain debts are dischargeable and others are not.  The following divorce related debts are not dischargeable in a bankruptcy filing:

Taxes (federal, state, real estate, etc) Child support Alimony (aka Spousal Support or Maintenance)

Debts arising from a marital settlement agreement or divorce decree are dischargeable unless the creditor (ex-spouse) objects to the bankruptcy proceeding.  This is why you want to have it spelled out in writing as to what happens in the event of a bankruptcy filing where all of the property settlement transactions have not yet taken place.

the following example illustrates another issue which could arise if you have split joint debt and your ex-spouse proceeds with filing bankruptcy.

Joint Debt Example â€" Let's assume that you have 2 joint credit cards with a balance of $ 10,000 on each for a total of $ 20,000.  Through your settlement agreement, you decide to split the joint debt evenly and each of you agree to pay off the 1 one of the credit cards (which we wouldn't recommend).

One year after the divorce, your ex-spouse decides to file bankruptcy and hasn't paid any of the debt of associated with the credit card.  Your ex-spouse will be relieved of half of the joint debt ($ 5,000) and you will be responsible for the other half even though you had split the joint debt in your settlement agreement. You are now on the hook for $ 15,000 of the credit card debt instead of the original $ 10,000.

Strategy: If you have concerns that your ex-spouse may be filing for bankruptcy, you will want to structure your property settlement in a lump-sum agreement if possible.  Also, if payments are to be made over a period of time, you may want to have those payments classified as child support or alimony.  This can help in protecting you from losing the income in the bankruptcy.

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Question by Nancy A: what happens to credit card debt during bankruptcy? i now the law changed th efirst of the year but what did it change to? Best answer for what happens to credit card debt during bankruptcy?:

Answer by Lillian K
If you file chapter 7 it is a discharge of what you owe. it is like paid off. My bankruptcy went through last april.

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