Dealing With Ex-Spouses & Bankruptcy
A recent study has found a shocking relationship between bankruptcy, separation, and divorce.
It revealed that one in seven individuals who declared bankruptcy in Canada noted that separation or divorce was one of the possible issues with their finances.
In many ways this is understandable.
After all, a divorce can certainly be a heavy toll on your bank account.
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Indeed, during the process of divorce, there will be a lot of legal bills as well as a certain level of emotional turmoil.
It’s also possible that you struggle because you are now responsible for paying bills that used to be shared between two people and this could include everything from rent to utilities.
Through a separation, your income will often remain at the same level but suddenly the costs in your life double and that’s true for both people in the relationship.
Joint Debts Through Divorce
It’s important to be aware that when you get divorced, you will be liable to pay any joint debts that you may have.
This means that if you have a joint credit card and your partner stops making payments, then you will be accountable.
There are ways to deal with this.
For instance, you can contact the bank and get them to provide separate loans to pay off the debt.
This ensures that you both know exactly what you owe.
If you are unable to pay off the debt, you could both need to file for bankruptcy.
Debts Don’t Go Away
You must also be aware that claiming for bankruptcy does not automatically clear any debts that you may have.
This is a common misconception that many people hold.
Alimony and child support will both remain.
If you do get divorced, then you may need to make certain support payments in exchange for particular assets.
When you declare bankruptcy, you might lose those assets completely.
But it doesn’t mean that the debt from support payments will disappear.
Get Advice From People Who Can Help
You might find yourself lost when trying to deal with debt and a divorce at the same time.
You’re not alone and many people do find this a complex issue.
That’s why you should make sure that you are contacting a trustee as well as a lawyer.
They will be able to help you assess all the options that you might have.
This could include everything from debt consolidation to a consumer proposal.
There’s no set answer on how you should proceed here.
It will always depend on your individual situation.
Are you struggling with levels of debt?
If so, contact us today and we will help you gain the relief you need with expert advice that you can trust.
We have helped more than 100,000 Canadians with their debt and won’t leave you to drown in yours.
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