We’ve all heard the old addage, “when it rains it pours” and it is never more true than when a couple files for divorce and then must also file for bankruptcy. Divorces can be costly especially if both the parties are not in agreement as to how to divide their assets and liabilities. Kelly Rutherfor, an actress on the hit show “Gossip Girl” just filed for bankruptcy following an extremely contentious divorce and custody battle. In her case, she had a son that she shared 50/50 custody with, however, because her husband lives in a foreign country and cannot come back to the States the children live with him and she must go overseas to visit them. She has been fighting to get physical custody of them to no avail. Rutherford is filing for Ch. 7 bankruptcy claiming over 2 million dollars in debts and only around $23,000.00 in assets. One of the biggest debts that she owes is to her divorce/family law attorney.
It is no surprise that many Americans have the same problem. Either the divorce will set the couple back financially or the couple’s grim finances have caused them to get divorced. It could be very beneficial for both parties to file bankruptcy before the divorce because there will no longer any debts to divide among the couple; an issue that can be a hot button during settlement negotiations. In California, all debts acquired during marriage are considered community property to be divided among both parties equally no matter what name the debt is under. Therefore, if the couple files for bankruptcy before the divorce proceedings, they can alleviate this very contentious issue leaving them to settle the divorce more amicably.
If you have questions about bankruptcy please give EH Law Group a call at (415) 230-5388 or visit our website at www.ehlawgroup.com. Our San Francisco bankruptcy attorneys, San Jose bankruptcy attorneys or San Mateo bankruptcy attorneys will be able to assist you. We will discuss your situation and assess what the best option is for you. We look forward to speaking with you soon!