Filing for Chapter 13 bankruptcy is a significant step toward financial recovery, but life doesn't always follow a straight path. During the three to five years of your Chapter 13 payment plan, various life events, including divorce, can unfold. So, can you get divorced while filing for Chapter 13 bankruptcy, and what happens next? In this article, we'll answer this important question and explore the options available to individuals navigating both Chapter 13 bankruptcy and divorce.
Answering the Question: Can You Get Divorced While Filing for Chapter 13 Bankruptcy?
Chapter 13 bankruptcy is a powerful tool that allows individuals to reorganize their debts and gain a fresh financial start by repaying debt over a structured period. However, life's circumstances can change, and divorce may become a reality during the Chapter 13 repayment process.
Here are the options available to individuals considering getting divorced while filing for Chapter 13 Bankruptcy.
Continue Working Together on the Chapter 13 Plan:
Even if you decide to get divorced, you can choose to continue making your regularly scheduled Chapter 13 payments together. While this option is logistically simpler and requires less effort, it can be challenging if you and your spouse no longer get along or if your individual financial situations no longer align with the original payment plan. Continuing with the existing plan may not always be the best option.
Modify the Payment Plan with Court Permission:
If maintaining the current Chapter 13 payment plan becomes too difficult due to divorce, you and your spouse can explore the possibility of modifying the plan based on your new circumstances. Since your budget will now include expenses for multiple households, your disposable income available for the Chapter 13 plan may decrease. In such cases, you may be able to have your monthly payments lowered. However, it's essential to note that the judge can only adjust the amount paid to general unsecured creditors, such as credit card balances, medical bills, and personal loans.
Convert to Chapter 7 Bankruptcy
If the existing Chapter 13 plan no longer suits your financial situation after divorce, you might consider converting to Chapter 7 bankruptcy as an individual. Your financial circumstances have likely changed significantly with the additional expenses of two households. However, before making this decision, it's crucial to consult with an experienced bankruptcy attorney. Chapter 7 bankruptcy may not always be the most suitable option, and an attorney can help you determine the best course of action.
Bifurcate the Bankruptcy
Another option is to petition the court to bifurcate the bankruptcy into two separate bankruptcies, one for each spouse. This approach allows you and your spouse to proceed individually based on what is best for each person's financial situation. One of you may opt to convert to Chapter 7, while the other may request the court to lower monthly payments. The possibilities are diverse, and an experienced bankruptcy attorney can guide you through the process.
Do You Have Questions Regarding Filing Bankruptcy in Baltimore? Contact The Law Offices of Nicholas J Del Pizzo
Navigating both Chapter 13 bankruptcy and divorce can be a complex and challenging process. The Law Offices of Nicholas J. Del Pizzo in Baltimore, MD, is here to provide the guidance you need to successfully navigate the bankruptcy process. Whether you're looking to eliminate debt, protect your assets, or save your home, we're committed to helping you achieve a fresh financial start.
The burden of overwhelming debt can be too much for anyone to handle. That's where we come in to help. At The Law Offices of Nicholas J. Del Pizzo, III P.A. in Baltimore, our knowledge and experience with bankruptcy law can assist you in wiping out your debts, reorganizing your finances, or saving your home. Contact us today to discuss your bankruptcy options and begin your journey toward financial relief and a brighter future.