Filing for Divorce While in an Active Bankruptcy
Sometimes while in a Chapter 13 case a couple may decide to file for divorce. An active Chapter 13 case will not prevent Debtors from filing for and getting a divorce but it does add a few additional steps to the process. (This post will outline the steps taken in Texas to get a divorce. Since divorce is a state preceding, the steps may be different depending on the state in which you are filing.)
If the Debtor is represented by an attorney, it may be necessary for the divorce attorney to obtain permission to serve as counsel for the Debtor from the bankruptcy court. This is because a Debtor typically has to ask permission when obtaining the use of professional services, such as an attorney, and because the Debtor cannot obtain new debt without court permission, such as attorney fees.
The next step will be for the Debtor or their attorney to file a petition for divorce in the state court. After the petition is filed in state court the Debtor can request permission to proceed with the divorce. The Debtor will need to file a motion to lift the automatic stay to allow the state court permission to grant the divorce. The reason for this is that the state court may be dividing up the assets and debts of the Debtors. Typically the Chapter 13 trustee will ask that the divorce decree be provided to their office after it is granted. This is so that they can review the effects the divorce will have on the current case.
Once the court grants the motion the state court can proceed with the divorce and can enter the final decree of divorce.
After the divorce is granted it is important that the Debtor contact their bankruptcy attorney because their schedules may need to be updated to reflect the changes in the household. If the Chapter 13 case originally was a joint-petition between the two married Debtors, the Debtors can continue in the bankruptcy together even after the divorce. If you are contemplating filing for bankruptcy but have concerns about your marriage, the attorneys at Fears Nachawati can help discuss your issues and advise you on how best to proceed through the process. For answers to any of your bankruptcy questions, contact us today for a free consultation.