When you have too much debt and you are unable to meet your financial obligations, filing for bankruptcy can be an attractive option. It is important to know exactly what kinds of debts bankruptcy can help with though. If you are struggling with, let’s say, alimony payments, this may not be your best option. A Bergen County Chapter 7 bankruptcy lawyer can tell you more about how the process works and whether or not this is a good option for you.
Why Won’t Alimony Be Discharged During Bankruptcy?
Alimony is considered a “domestic obligation” in most cases. It’s like child support. According to an agreement you reached or an order from a judge, you have an obligation to your family, even if we are talking about your former spouse. You cannot try to back out of paying this when you go through bankruptcy.
Is There Any Benefit to Going Through Bankruptcy If I Owe Alimony?
Even though you cannot erase your alimony payments or any back alimony you owe, going through bankruptcy can still be beneficial. There are a few good reasons to consider filing for bankruptcy anyway.
First of all, it stops all debt collectors from going after you while your bankruptcy is in progress. This means that if you currently owe alimony, no one can come after you for it until after you complete this process. That can make life a bit less stressful in the short term, even if this particular debt is unlikely to be wiped from your slate.
Another benefit is that you could still discharge other debts, leaving you with money to pay alimony. If you are also dealing with high-interest credit card debt or medical bills, getting rid of that can be a big financial relief. Whether you liquidate assets in Chapter 7 bankruptcy or make a payment plan with Chapter 13 bankruptcy, you may find that meeting your alimony obligations is no longer a challenge.
Can I Modify My Spousal Support Agreement After Going Through Bankruptcy?
You can sometimes modify an alimony agreement when your financial situation changes. If you are seriously considering filing for bankruptcy, that could be an indication that you should be heading back to court to ask about changing your spousal support agreement.
You can also decide to change your agreement after going through bankruptcy, once you have a better understanding of the total debts and assets that you have left. In any case, you should make the most of this opportunity to make good on your financial obligations to your family.
Contact Our Law Firm
If you are seriously considering filing for bankruptcy, contact the Law Office of Boyd & Squitieri. We can schedule a consultation and give you the chance to meet with our legal team. If we think that you are a good candidate for bankruptcy, we can help you with the process.
