Divorce and Bankruptcy Lawyers in Texas

Divorce can take a serious emotional and financial toll on families. If you’re in financial strain and considering divorce, filing a joint bankruptcy before you start divorce proceedings is an option that can help both you and your spouse start over with a clean financial slate.

Divorce and Bankruptcy Lawyers in Texas

• Financial Consequences of Divorce
• How Divorce Impacts Your Credit Score
• How to Prevent Harm to Your Credit during a Divorce
• When Should I File for Bankruptcy If I’m Getting Divorced?
• What about Filing for Bankruptcy after Divorce?
• How Does Marital Debt Work in Texas?
• Which Debts Cannot Be Discharged in Bankruptcy?
• What Is Credit Counseling?
• Why Choose Our Texas Bankruptcy Attorneys?
• Schedule a Free Consultation with a Divorce Bankruptcy Lawyer

Filing bankruptcy while you’re going through a divorce can throw a wrench in proceedings and result in them dragging on much longer than you intended. Before making any decisions about debt relief options, seeking the counsel of a local bankruptcy attorney is critical. Our divorce bankruptcy lawyers at Leinart Law Firm can evaluate your financial situation and advise you on the most effective course of action to protect your interests.

Financial Consequences of Divorce

Navigating divorce and financial issues can be daunting. Even if you’re parting with your spouse on mutually amicable terms, there are financial considerations that can have a significant impact on your lives. Some issues that many couples deal with include:

• Lost or reduced income
• Childcare expenses
• Child support and alimony payments
• Loss of health insurance
• Retirement account issues
• Tax problems
• Mortgage and loan payment disputes

How Divorce Impacts Your Credit Score

Financial issues can have a substantial impact on relationships and are often a major reason for divorce. While the divorce process doesn’t directly impact your credit score, there are many financial obstacles couples may face when getting divorced. Some issues that can cause your credit score to drop include:

• Closing credit accounts
• Higher percentages of credit utilization if you use credit cards to pay for legal fees and other expenses
• One person failing to make payments on a joint or cosigned loan or mortgage
• Missed credit card or loan payments due to conflict, miscommunication or stress

Unfortunately, some spouses deliberately run up credit card debt, knowing that it will be split in a divorce. If a relationship is particularly contentious, a spouse may even overspend to intentionally harm the other person’s credit. This kind of behavior can have a significant negative impact on both parties’ credit scores.

How to Prevent Harm to Your Credit during a Divorce

The best way to prevent your credit score from taking a nosedive during your divorce is to maintain mutual respect for your spouse. Keep lines of communication open about your finances and create a strategy for how to walk away from the relationship in a way that doesn’t harm either of your finances. Having a bankruptcy or credit repair attorney assist you with this can help make resolving issues easier and help protect your credit during your divorce.

Divorce Bankruptcy FAQs

When Should I File for Bankruptcy If I’m Getting Divorced?

Although each case is unique, filing a joint Chapter 7 bankruptcy before you file for divorce is usually the most expedient and equitable option. However, bankruptcy isn’t always the best way to reduce or eliminate debt. If you believe bankruptcy may be an option for you, there are specific factors to consider before filing for divorce. For more than 15 years, our Dallas and Fort Worth debt relief lawyers at Leinart Law Firm have helped businesses, individuals and couples find creative solutions for restructuring or getting rid of debt.

What about Filing for Bankruptcy after Divorce?

Another option is to file Chapter 7 or Chapter 13 bankruptcy after divorce. Chapter 7 bankruptcy lets you discharge most or all of your debts and get a fresh start post-marriage. Chapter 13 bankruptcy still eliminates your unsecured debt and also helps you catch up on any secured debts (house or car) that you are behind on over a period of three to five years. With the help of an attorney who fully understands the specifics of your case, you can make informed decisions that benefit you in the long run.

How Does Marital Debt Work in Texas?

The way marital debt is divided in a divorce depends on where you live and when the debt was acquired. Texas is a community property state, which means that any asset you or your spouse acquired during your marriage is considered community property. Each person has a 50% interest in community property.

Similar to community property, you and your spouse are equally liable for any debt incurred during your marriage. However, some specific circumstances can impact the amount of debt you owe. You and your spouse may also come to a specific divorce settlement agreement that assigns a certain amount of debt to each spouse that is not necessarily 50/50.

It’s important to note that if your ex-spouse files for bankruptcy after divorce, you may still be on the hook for all jointly held debt. Even if the debt is discharged for your former spouse, creditors may pursue you for repayment of the entire outstanding amount.

Which Debts Cannot Be Discharged in Bankruptcy?

Generally, non-dischargeable debts include:

• Child support and alimony
• Student loans
• Certain types of tax debt
• Debts owed due to personal injury or wrongful death due to a drunk driving accident
• Attorney fees for child custody or child support-related litigation
• Retirement account loans
• Fines or penalties owed to government agencies
• Criminal restitution and other court fines or penalties

Whether a debt is dischargeable may also depend on the type of bankruptcy you file. Although there are federal bankruptcy laws that may apply, each state has its own bankruptcy laws as well. That’s why it’s vital to seek the counsel of an experienced Texas bankruptcy attorney who can help you understand the specifics of state law.

What Is Credit Counseling?

Credit counseling organizations are usually nonprofits with counselors who are certified and trained in consumer credit, money and debt management and budgeting. Before you can file Chapter 7 or Chapter 13 bankruptcy, you must receive credit counseling, which can help you prioritize debts, create a budget and learn how to live within your means. Regardless of whether you opt to file bankruptcy, credit counseling can empower you to get out from under credit card debt, create a realistic strategy for paying your bill and help you get on the road to becoming debt-free.

 

Timing Your Financial Fresh Start: Navigating Divorce And Bankruptcy With Precision

At Leinart Law Firm, Divorce and Bankruptcy Lawyers in Texas understand the intricate dance between divorce and bankruptcy. Timing is crucial when considering these two life-altering events. Let’s explore the key considerations and legal implications of whether to file for bankruptcy before or after divorce:

1. Protecting Joint Assets:

Filing for bankruptcy before divorce can help protect joint assets. The automatic stay that comes with bankruptcy prevents creditors from pursuing joint assets, providing a safeguard during divorce proceedings.

2. Streamlining the Process:

Opting for bankruptcy before divorce can streamline the legal process. Resolving financial matters in bankruptcy court may simplify divorce proceedings, as certain financial issues are addressed in the bankruptcy case.

3. Joint vs. Individual Filings:

Couples have the option to file for bankruptcy jointly or individually. Analyze the financial situation to determine the most advantageous approach, considering income, debts, and exemptions.

4. Bankruptcy’s Impact on Support Obligations:

Filing for bankruptcy can impact support obligations. It’s crucial to understand how alimony and child support are treated in bankruptcy, as these obligations may take precedence over other debts. Your Divorce and Bankruptcy Lawyers in Texas from our firm can assist with these issues.

5. Preserving Credit for Both Spouses:

Filing for bankruptcy before divorce may allow both spouses to preserve their credit. The impact on credit scores is shared, potentially providing a cleaner financial slate for both individuals.

6. Division of Marital Debt:

Understanding the division of marital debt is essential. Bankruptcy can discharge qualifying debts, impacting how marital debts are allocated during divorce. Consider the implications for both parties.

7. Post-Divorce Financial Planning:

Filing for bankruptcy after divorce requires careful financial planning. Consider future financial needs, including housing, child-related expenses, and potential changes in income, to make informed bankruptcy decisions.

8. Tax Implications:

Be mindful of tax implications associated with timing. Consult with tax professionals to understand the potential tax consequences of filing for bankruptcy before or after divorce.

9. Exemption Considerations:

Exemptions play a significant role in bankruptcy. Evaluate the exemptions available in Texas and how they may impact the division of assets and debts during divorce.

10. Legal Representation:

Seek legal representation early in the process. Consult with experienced Texas Divorce and Bankruptcy Lawyers who can assess your unique situation, providing guidance on the most favorable timing for your specific circumstances. Our firm has helped many people navigate these types of issues and we know that we can help you too. Our firm will take the time to sit with you and listen to your concerns.

Let Our Firm Help You In Difficult Times

Navigating the timing of divorce and bankruptcy requires careful consideration of individual circumstances. At Leinart Law Firm, our team of experienced Texas Divorce and Bankruptcy Lawyers is here to provide personalized guidance tailored to your needs. We understand how both of these major items can change someone’s life. Let us help you chart a course towards financial stability and a brighter future.

Why Choose Our Texas Bankruptcy Attorneys?

The best bankruptcy lawyers care about their clients’ financial stability and overall well-being. At Leinart Law Firm, we understand that facing financial troubles and divorce at the same time can be an emotional rollercoaster and lead to unwanted stress. We’re here to help you sort it all out and provide the quality legal advice and support you need to get through challenging times. Whether you’re looking for a divorce bankruptcy attorney in Houston, Dallas, Plano or Fort Worth, our caring, competent team serves clients throughout North Texas.

Schedule a Free Consultation with a Divorce Bankruptcy Lawyer

Our bankruptcy attorneys at Leinart Law Firm provide practical debt relief options and sound legal advice you can trust. To learn more, please call our Dallas office at 469-232-3328 or our Fort Worth office at 817-426-3328. You can also fill out the contact form on our website, use our convenient chat feature or email us to schedule a free consultation today.