For many married couples, financial challenges may contribute to excessive stress on their relationship and may even be a primary contributing factor that leads them to get divorced. If a couple’s financial situation is severe enough to warrant the need to consider debt relief via a bankruptcy, they will want to carefully assess their options about the type of bankruptcy to file and the timing of a bankruptcy relative to the timing of their divorce. 

As explained by U.S News and World Report, regardless of how much debt a couple has or their ability to repay it, getting divorced with debt requires the spouses to assign responsibility for the debt as part of their property division settlement. If one person is supposed to repay a certain joint debt but eventually fails to do so, a creditor may pursue repayment from the other person if the joint account remained intact with both parties’ names on it. 

Many people prefer to pay off any joint debt before getting divorced or as part of their divorce process. For this reason, filing for a joint bankruptcy prior to filing for a divorce may be beneficial to a couple as it eliminates the need to divide any joint debt by ensuring that debt is included in the bankruptcy. Experian adds that a joint bankruptcy may also help people by providing higher exemption limits than on an individual bankruptcy. 

An important factor people will need to consider is their ability to cooperate with an estranged or separated spouse in filing their bankruptcy. If the couple’s level of conflict is high, it may be wise to complete the divorce before the bankruptcy.