My husband and I are currently going through divorce (not related to debt), and have approximately $58,000 in joint debt that we are dividing 50/50 (this does not include our individual vehicles). Once we are divorced he will assume responsiblilty to pay over $400 in child support and with that on top of his 50% of all the other bills he will not be able to pay some of them.
I currently live in a home owned by my parents with our son and he has no permanent residence as he cannot afford one.
Our debts are as follows (these are all approximate amounts): $750 in medical bills for our son, $6000 to Discover Card, $4000 to Mastercard, and we have 2 Cards in Debt Management totalling $11,500, and then there is a Bank Loan (with my parents home as collateral) for $35,000. I do not believe that bankruptsy is an option for us due to my parents home being collateral.
My husband was trying to find someone to co-sign a loan for him to “purchase” his half of the debt and I could refinance the other half for a lower payment, but no one is willing to assume that kind of responsibility for him.
I know once the child support starts this will be a problem as money is just enough to cover as it is and he will eventually need to find a permanent home. If you could give me some advice on what we could do I would appreciate it.
When two people get divorced they are breaking the bond from each other and not the creditors. Meaning, if any of the debt is joint debt, you will bot be equally liable for the balance due until the joint accounts are closed and paid.
Is the loan that pledges your parents house as collateral a joint loan or only in one of your names?
Over the many years I’ve see so many of these divorce situations just flat out explode once the two income household becomes two separate one income households. Just on face value your situation looks like it has a high potential to be one of those situations.
And of all the debts, the child support is a priority debt and must be paid before all other debts.
I think it makes sense for you to first explore bankruptcy anyway. You can discuss the loan secured by the home and talk about if you can reaffirm the debt to keep your folks out of it as much as you can.
But based on what you’ve said, this is going to blow up at some point. It’s much better to deal with this proactively than when your husband misses child support payments and bills start to fall behind.
You can click here to find a local bankruptcy attorney. Talk to them and include your folks in the conversation. Let’s plan an excellent battle plan than having to write a financial obituary later.
Does that make sound sense to you?
Please post your responses and follow-up messages to me on this in the comments section below.When to Get a Divorce Followed by Bankruptcy? - Christy by Steve Rhode