We Are Getting Divorced After 24 Years and We Have a Lot of Debt.

“Dear Steve,

My husband and i are divorcing. we have been married for 24 yrs. we pay all our bills on time. i did accidently pay a credit card late for 2 months in a row. i deducted it out of checkbook but didnt pay online. he is on disability and i am the main provider. we are starting to get into debt and i will have to take the majority of those debts. we owe approx. 3500.00 per month in bills but bring in approx 6200. however we cant seem to manage to save any money. we have been cutting way down on wasting money however we still havent been able to save.

we have 2 mortgages. the first we owe 44 thousand and it would have been payed off in 6 yrs. However the pymt is 900.00 per month.We are now paying mostely on the principle. we also took out a 2nd mortgage which is appr 54 thousand. the min paymnt is 300.per month which is all interest. i try to pay at least 400.00. My husband nor I can pay these pymts by ourselves. I dont know whether to try to refinance or try to put the house on the market or just let it go back to the bank. I am thinking the “value is approx 120,000 thousand”. our credit scores are around 720.

Sherri”

Dear Sherri,

A bigger issue here is how this fits in with your divorce. One logical approach here is to give you both a clean slate moving forward. While you are the primary provider, if any of these debts are in his name as well, if something were to happen to you the creditors could go after him for full payment.

Do You Have a Question You'd Like Help With? Contact Debt Coach Damon Day. Click here to reach Damon.

Granted, if he’s living on benefits alone and has no assets there would not be much for them to go after, it would still be a most unfortunate situation.

Just as a matter of exploring all sides of this issue I’m curious if you have considered looking into a divorce timed bankruptcy. This will break the financial bonds at the same time the martial bonds are broken.

Your ability to file bankruptcy would be dependent on several factors but it would be a smart idea for you to click here to find a local bankruptcy attorney and talk to them about your situation.

I would prefer that you do that and then report back in and post a comment below about your impressions of what bankruptcy would mean for you in your situation.

The best case scenario is that this approach would give you both a needed financial break and allow you to move ahead on your own power rather than be sucked down by debt you may not be able to service while trying to create two new households.

Does that sound like a prudent and reasonable approach to you?