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BANKRUPTCY AND DIVORCE

 

It’s not uncommon for someone to file bankruptcy after a divorce. You or your ex-spouse may not be able to keep up with payments on a single salary. It happens, it’s a legitimate reason to look for relief through bankruptcy.

Money is a big stress factor in many relationships. Sometimes a couple that has money problems will think that the answer to their problems is divorce. Each spouse is likely to believe that the other is mostly responsible for the couple’s money problems. This belief may or may not be true. One thing is true, you can divorce your spouse, but you can’t divorce the debts incurred during your marriage.

When either party contemplates bankruptcy, one consideration is the timing of the filing and whether the parties should file a joint bankruptcy before or during the divorce, or an individual bankruptcy before, during, or after the divorce. Your creditors are not part of the divorce, and the family court cannot alter, modify or revise the contract between debtors and creditors.  Any joint debt discharged by one party will leave the other party solely liable, exposed to collection efforts and law suits, and will often force the other spouse to repay or file bankruptcy.

Both spouses are responsible for the debts incurred during the time of the marriage. Your divorce settlement will divide up the debts, assigning responsibility for some to one spouse and some to the other. But that divorce settlement is between you and your ex-spouse. It doesn’t bind your creditors, who can collect the debt from either of you. This means if your ex-spouse doesn’t pay his or her share of the debts, the creditor can come after you for payment.

HOW CAN I GET STARTED?

Call our office today and set up your free consultation with an attorney. We will discuss which chapter of bankruptcy is best for you.

Bankruptcy can mean different things to different debtors. There are several types of bankruptcy chapters provided under the U.S. Bankruptcy Code, each with its own rules and procedures.

The most common filings for bankruptcy are Chapter 7 and Chapter 13. Chapter 7 will wipe out all your unsecured debt (credit cards, medical bills, utilities, etc.). You can also keep your house and vehicle in Chapter 7, as long as you are or can get current on payments. Chapter 7 is a straight bankruptcy. This will stop all collection proceedings including phone calls, mailings, garnishments and court proceedings. Most bankruptcy filings in the U.S. are Chapter 7. Under a Chapter 7, any debt incurred to a spouse or former spouse that is incurred during a divorce by agreement, decree or court order is not dischargeable.

Chapter 13 is a repayment plan. It is referred to as a wage earner plan. You must have a reliable source of income to repay all or a portion of your debt. Chapter 13 will stop a foreclosure or repossession as well. It is designed to help you retain your home or vehicle if you are behind in payments. You will repay 1% to 100% of your unsecured debt, depending on your individual situation. Repayment will  last a minimum of three and maximum of five years. During this time it will be up to the creditors to file claim in order to be paid during the case.  Under a Chapter 13, the debtor may receive a discharge from obligations incurred as part of the divorce if certain conditions are met.

HOW CAN I GET BACK ON TRACK?

Once you have fully discharged, rebuilding credit can sometimes seem like an overwhelming task. But it’s important to realize that there is life after bankruptcy. Repaying your existing bills as agreed will be one of the single most powerful things you can do to restore your finances and your credit.

FREE CONSULTATION

Contact our office at 513-752-3900 to schedule your free consultation to see if bankruptcy will give you the financial relief you are looking for.

BANKRUPTCY & THE SENIOR CITIZEN

Bankruptcy is designed to help people overly burdened with debt gain a fresh start. Often the person needing relief is a senior citizen. We have a rapidly growing senior population and while many have been able to plan for the future with quality pensions and health insurance plans, many rely solely on social security.  Problems develop when these individuals are hit with demands from creditors on debts they have co-signed on, often for their children and grandchildren.

In most cases, if you are senior citizen collecting social security, you will likely travel through the bankruptcy process problem free. Even if you own your home or car outright the asset exemptions for Ohio residents is high enough that it will likely protect your home and your vehicle.  If you are elderly, you may qualify to have the filing fee waived by the court.

Social security and pension plan payments are exempt in bankruptcy. In other words, they will not be touched by the bankruptcy court.

Many seniors place undue pressure on themselves to pay debts when they are struggling to pay for food and medication. Many were raised with the view that bankruptcy is not an option and see it as indicator of failure. In reality bankruptcy is a legal option that allows seniors to focus on their own needs and not their creditors.

Contact our office today to see if bankruptcy will be able to help you or your aging parents get a fresh financial start.

Call 513-752-3900 to schedule your free consultation with an experienced attorney.  We offer a free consultation, fair fees and monthly payment plans. We are caring and knowledgeable attorneys.

Bankruptcy -Protect Your Hard Earned Assets AND Eliminate Overwhelming Debt

Since 1992, our office has helped thousands of people protect their assets and eliminate overwhelming debt. Job loss, divorce, a medical emergency or other catastrophic events are usually why people see us.  Millions of people have used the U.S. bankruptcy laws to get a fresh start.  There are several myths about bankruptcy.

I WILL HAVE TO GIVE UP MY HOUSE AND CAR

The bankruptcy law provides for generous exemptions. Everyday, our clients use legal exemptions to protect their home and vehicles. Sit down with one of our attorneys to learn how your assets can be protected.

BANKRUPTCY WILL RUIN MY CREDIT FOREVER

Bankruptcy stays on your credit report for up to 10 years, but once the slate is clean after bankruptcy, you can start to rebuild your credit. In fact, many people enjoy stronger credit scores after filing. Bankruptcy clears debt and gives a fresh financial start. You are a better credit risk to many creditors after bankruptcy with your unsecured debts eliminated. You will be surprised at the amount of credit card offers you will receive after your bankruptcy filing.  Creditors are willing to extend credit because they know you are debt free and cannot file again for some time.  Keep in mind these offers will initially have high interest and fees. We recommend that you consider your budget, long term goals and needs carefully before taking on any new debt. Bankruptcy has helped millions of Americans get out of debt and bankruptcy can help you too.

BANKRUPTCY IS EXPENSIVE

Many people believe that bankruptcy will be too expensive.  Bankruptcy is not free, but the fee is small compared to the amount of debt you will be discharging.

MORE INFORMATION

The office of Keegan & Company Attorneys offers a free consultation with an experienced attorney and discuss your unique situation. Our attorneys will go over all of your options and quote you a fee.  Our offices are conveniently located in Eastgate and Middletown, Ohio.  Call 513-752-3900 to set up your free consultation appointment.

 

Will I Lose My Home in Bankruptcy?

 

Home ownership is part of the American Dream.  So, what happens when you achieve this dream and run into financial difficulty? In most cases you can keep your home even if you decide to file for personal bankruptcy.

CHAPTER 7 BANKRUPTCY AND YOUR HOME

Chapter 7 bankruptcy also referred to as straight bankruptcy or liquidation bankruptcy is a process to discharge your unsecured debts. Thankfully, in Ohio there is a large homestead exemption.  As long as your equity in your home does not exceed this exemption the bankruptcy court cannot sell your home. As of 2022 this exemption is approximately $145,000 per individual and $290,000 per couple. To keep your home in Chapter 7 you should be current on your house payments. As long as you are current and do not have equity beyond the exemption amount you will be able to keep your home.   If you wish to keep your home you will typically sign a reaffirmation agreement. This document makes your mortgage non-discharged and your mortgage holder will continue to report your payments to the credit reporting agencies.

CHAPTER 13 BANKRUPTCY AND YOUR HOME

If you have too much equity in your home or are behind on your mortgage payments you can save your home through a Chapter 13.  A Chapter 13 bankruptcy is a repayment plan.  If your home is in foreclosure you can file Chapter 13 up to the moment the sheriff auctions your home. You will then make your regular house payment and your arrears payment through the Chapter 13 Trustee. Once you complete your case you will be current on your home and will then make your payment directly to your lender.

MORE INFORMATION

Call 513-752-3900 to schedule a free consultation. We will give you plenty of time to discuss your individual circumstance with an experienced bankruptcy lawyer.   We offer fair fees, payment plans, easy parking and two convenient locations: Eastgate, Clermont County & Middletown, Ohio. Since 1992, Keegan & Company Attorneys has helped thousands of your neighbors protect assets and gain financial peace of mind.