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Bankruptcy after Divorce: Are You Liable for Debt that Belongs to Your Ex?

Posted By admin || 7-Nov-2012


It's common to wonder what may happen if your ex-spouse files for bankruptcy after divorce. While a divorce agreement may have been in place detailing who is responsible for outstanding debt, you may wonder if creditors have a right to pursue the other spouse.  In some cases they can, but what if your ex-spouse files bankruptcy in contempt of the divorce decree? Could you force the ex-spouse to pay what is due or seek bankruptcy protection for yourself?

Cases including a similar scenario may have varying results.  In some cases it depends on the state you live in along with details outlined in your divorce decree.  You may be advised to seek assistance from your divorce attorney to file for contempt.  At the same time you may be advised to file bankruptcy.  Why?

If the debt in question was the responsibility of you and your ex-spouse but your ex was ordered to make payments on the debt, the creditor may decide to pursue the other spouse when bankruptcy is filed. Creditors don't care about divorce decrees but they know who is liable for outstanding debt depending on whose name it is in.

The divorce agreement acts as a judgment that enforces the other spouse to pay debt they agreed to be responsible for. Since the document was approved in court you would need the assistance of a divorce attorney to enforce the agreement.  If your ex-spouse files bankruptcy and you are also liable for debt owed but unable to pay, you may need to consider bankruptcy. Review your situation with a qualified divorce attorney and bankruptcy expert.

Reference:  http://www.foxbusiness.com/personal-finance/2012/10/23/ex-files-bankruptcy-am-stuck-with-his-debt/

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