I have an question about bankruptcy. my wife and I have an Property and Settlement agreement for an divorce. I need to file for an bankruptcy and being that I have this can I still be able to file for this. Here is what it says in the papers that in the courts.
Bankruptcy: It is understood, mutually covenanted and mutually warranted that none of the financial duties and responsibilities of the parties to each other specified or referenced herein shall be dischargeable in bankruptcy as each party has given bona fide consideration and relinquished marital rights for same. The debts shall survive the filling of any petition in bankruptcy by either party, weather voluntary or involuntary, and all proceedings taken thereunder, as well as general assignment for the benefit or creditors or other proceedings base on insolvency, and claims hereunder shall at all times remain in full force and effect and enforceable until performed and discharged in accordance with the terms of this Agreement, The parties further specifically intend any hold harmless or debt agreement to be in the nature of the payment of alimony or spousal support and shall not be dischargeable in bankruptcy as it is not a division or property or a property settlement. Such a duty arising hereunder is the enforcement of a marital duty in accord with public policy.
The debtor spouse currently has the financial ability to meet his or her obligations under this Property Settlement Agreement and that the needs of the creditor spouse and children outweigh the burden on the debtor spouse of satisfying the obligations.
The creditor spouse shall be entitled to attorney's fees and cost incurred in protecting his or her right to support in a bankruptcy proceeding and if he or she substantially prevails, in a non-dischargeability claim.
The debtor spouse shall continue to perform his or her non=support obligations under this Property Settlement Agreement until there has been a determination that such obligations are dischargeable.
So I would like to see if I can still file now because I need to file ASAP and I will be getting money from her 403 retirement account so will that hurt this matter when I get the money. If you can explain if I can file now or not being that I an going thru an divorce now.
1 Answer from Attorneys
This does not prohibit a bankruptcy filing, and probably has little effect on such a filing. However, understand that except under Chapter 13, all obligations undertaken pursuant to a divorce settlement agreement are not discharged. In Chapter 13, you can discharge non-support debts, but only if you act in good faith. Filing bankruptcy while a divorce is pending can be very risky, so you need to have a very serious discussion with your divorce lawyer and a competent bankruptcy lawyer with experience in these issues.
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