Thursday, January 31, 2013

When is the Best Time to File for Bankruptcy – Before, During or After the Divorce?


The answer depends on the circumstances of the parties and their level of cooperation with each other.

Pre-Divorce Bankruptcy:

A bankruptcy before the divorce will save costs and attorneys’ fees charged to the husband and wife for the bankruptcy. Typically the cost of a joint case is not much more than an individual case and the filing fees are the same. Thus, jointly-filing spouses can save roughly 50% by filing together while still married. Furthermore, the bankruptcy case can clear up issues involving debts and assets, which may facilitate an easier divorce proceeding. If the parties have significant debt problems, then it is wise to consider filing before the divorce.


Mid-Divorce Bankruptcy:

Filing during the divorce case, while fairly common, can cause considerable problems. Usually, this tactic is taken by one spouse to spite the other and delay divorce proceedings. Most proceedings are not stayed by a bankruptcy filing. However, property divisions are an exception. If there are assets to be divided, the bankruptcy trustee will now have to be involved in the matter. A division of assets will need to be fair, otherwise, the trustee can bring objections in the bankruptcy court. Bankruptcy trustee intervention in the divorce case usually means higher fees and costs to the divorcing parties and higher scrutiny to property divisions. On the other hand, if there are no assets for the bankruptcy estate to administer, a mid-divorce filing has little effect.


Post-Divorce Bankruptcy:

After the divorce, a bankruptcy filing can bring greater scrutiny of the marital settlement agreement and the division of assets. If the division is not reasonable, then a bankruptcy trustee can bring an avoidance action. Debts incurred by one spouse and owing to the other during the bankruptcy proceedings are likely

not dischargeable. Additionally, costs will be higher if both formerly married spouses file. This is also where debt allocation and hold harmless/indemnification clauses will be a critical factor, depending on whether counsel represents the filing or non-filing spouse.



Andrew G. Storie is a family law and divorce attorney who serves Orlando and all of Central Florida. For more information, or if you have questions please visit or call us at (407) 838-0887.


Thursday, January 24, 2013

Nine Must-Dos Before Filing for Divorce


Divorce is a major transition that shouldn’t be taken lightly. Psychologically, it’s one of the most traumatic experiences in life.It is important to not only be emotionally ready for a divorce but also to be prepared for what to expect during the divorce process as well as your new life after the divorce is final. As a result,  filing for a divorce should be the last step, not the first step.

Henry S. Gornbein, P.A., and President of Henry S. Gornbein, PLLC, a family law firm in Bloomfield Hills, MI has a list of nine steps to walk through before proceeding with divorce. They are:

1. Try marriage counseling. The obvious reason to do this is to see if your marriage can be saved. Another reason is to learn everything you can about yourself so you don't repeat the same mistakes with the same kind of person again and again

2. Find out as much as you can about your family finances. Have copies of your tax returns, savings accounts, checking accounts, credit card statements and investment accounts. The more you know about your finances, the better prepared you are if you do go through with a divorce.

3. If you have kids, think about time-sharing arrangements. Keep track of how much time you and your spouse each spend with your children. Record what you do with your children. Is this a case where there should be equal timesharing? Proceed with what's best for your kids, not what's best for you. “You don't want to use your children as a weapon to try to punish your spouse,” says Gornbein.

4. Prepare a budget. Determine how much income you’d need to survive on your own. Evaluate whether you need to brush up on skills for the job market or obtain an education.

5. Talk to an attorney. Make sure your counsel is knowledgeable and experienced in family law. Discuss costs and expectations. You should be able to relate to your attorney. “There are a lot of good attorneys,” says Gornbein. “It's important to make sure you have the right fit.”

6. If you have a home, decide what you’d do with it. Would you or your spouse keep it? Would you sell it?

7. Keep a diary. Simply keeping track of events and emotions can be surprisingly important. As you reflect, envision a plan for your future. Would a divorce free you up to reach for your goals? Or would you look back with disappointment and regret?

8. Build a support system. Consider who among your family and friends you can trust and talk to. Gornbein warns, however, that everyone will have different opinions and advice, so having presence of mind to make your own informed decisions is crucial.

9. Ask yourself if you’re sure you want a divorce. Carefully think it out and analyze what makes sense. You could regret a knee-jerk reaction later in life, especially if you want to leave your marriage for another relationship. “I've seen so many people who leave one bad marriage for a bad relationship and end up going through another divorce,” says Gornbein.

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Andrew G. Storie is a family law and divorce attorney who serves Orlando and all of Central Florida. For more information, or if you have questions please visit or call us at (407) 838-0887.