The main impacts of bankruptcy on divorce are that: - a bankruptcy discharges the bankrupt spouse from any liability on joint debts making these debts the solely the obligation of the non-filing spouse. - a bankruptcy will eliminate any property settlement due from the bankrupt spouse to the non-filing spouse. - a bankruptcy will eliminate the bankrupt spouse's obligation to pay debts of the non-filing spouse under the divorce decree (for example, the bankrupt needed a car but had bad credit so the non-filing spouse bought the car and is solely liable on the loan, the divorce decree assigns the car to the bankrupt spouse and requires that the bankrupt spouse make the payments - filing bankruptcy would supersede the divorce decree and eliminate the bankrupt spouse's obligation to make the car payments). Bankruptcy does not eliminate the bankrupt spouse's obligations for support, that is, child support and alimony. In order to determine what the effect is on the non-filing spouse and whether the bankrupt spouse should file before or after the divorce case, depends on the situation in each case.
Answered on Sep 22nd, 2016 at 6:25 PM