Debt and Divorce

Unfortunately, those are not going to be discharged in your bankruptcy petition. Those and also taxes. If you and your wife are unable to reach an agreement with regards to how you are to split the debt--the court might hold a session for you called ancillary hearing--it is like a sub case hearing for major cases like your bankruptcy and/or divorce.

Okay here some quick facts to move you along:

1) Request a copy of your credit report
Do get a copy from all three major credit bureaus. Fortunately for you credit reports are separate documents even for a married couple. The sooner you know all about your accounts and debts the better.


2) Close your joint accounts
If your spouse uses the joint accounts before the divorce or legal separation, you may be held responsible for repayment. Remember also when you cancel your credit cards, make sure they read “closed by consumer” that way, your credit report would look better.

Don't forget to change the title of your hecking, savings, and investment accountsfrom joint to individual, and your beneficiaries (to the person of your choosing).

3) Open accounts in your name now
This way you can start your own life. Any debt or money incurred/saved would be yours and yours alone.


4) Study your state’s community and separate property laws
Each state has different laws about debt and divorce. If you live in a community property state, any debt you or your spouse incurred during the marriage, regardless of was responsible for it or who ordered it , is considered a marital debt by the court-- meaning the creditor will go for the both or either of you for repayment. In a separate property state (common law), this may not be the case. Get in touch with your State Bar Association to learn more about legal responsibility and debt for your area.

The 9 community property states are Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington and Wisconsin. In Alaska, couples can opt to adopt the community property rules in marriage.

Your spouse though, if you file bankruptcy AFTER the divorce, and the joint debts were discharge by the court, might still be held responsible for the remaining debts by the creditors. I do not going at it by yourselves. On issues of debt, I think that you should consult with a financial adviser. It has to be somebody neutral.


Feel free to fill out one of the forms here and speak with one. Don't worry it's free and it with give you clarity and direction.

how about taxes?

alimony is tax deductible but child support is not.

how about the marital home? what's the best thing to do about it?

I am not a lawyer so it's best if you consult with one, but since your marital home is perhaps your largest asset, and since you are not in good terms with each other, you might as well sell it and divide the proceeds. Since you are in debt too, why not use that to pay off the debts, and not go through the difficult court and debt negotiation processes.

However if there are children involved, and one spouse may actually benefit from staying in the home, the other spouse should just sell/buy whichever applies, the part of the other spouse.

i live in CA and am going thru those two problems--debt and divorce. my wife and i are trying to figure out which debts belong to which spouse. most of these are joint account and we're tryinmg to figure out who owns what