Why Does Divorce Often Lead to Bankruptcy?

Money problems are frequently at least one of the factors that can lead a couple toward divorce. Often, spouses tend to blame one another for the financial struggles that have cropped up in their marriage. This can lead to a lot of fighting and distress that starts to form a wall between husband and wife. When the wall grows so high that it seems insurmountable, divorce can seem like the best (or only) resolution.

We’re not here to debate whether or not you and your spouse should or should not split up. That is totally your business, and we recognize that it is only our business to get your financial status back to where it used to be.

Regardless of the reason(s) for the demise of your marriage, the act of getting divorced itself often leads to bankruptcy of one or both spouses. If you’re counting on your divorce to wash all of your money troubles away, you’ve got a harsh reality to face. Some of the major reasons so many divorced couples end up bankrupt include:

Going from two incomes to one: Most couples who are married or committed long-term without being legally married tend to pool their incomes together in order to support their lifestyle. After a split, your spouse’s income vanishes, and you’re left to fend for yourself with only the money you make. Many times, this means attempting to continue making the same lifestyle choices with much less money. What happens is that the money runs out QUICKLY.

Legal fees: This is a factor in divorce that you actually have a lot of control over. Those couples who refuse to come together in order to create a settlement that works for both parties are only hurting themselves by racking up a ton of lawyer hours that simply aren’t necessary. As a matter of fact, you don’t even need TWO attorneys to get divorced! If you and your spouse can agree that you want to split amicably – using one attorney will save you thousands of dollars. The less in-fighting there is between the two of you, the lower your legal fees will be.

Alimony and/or child support: Naturally, you are legally required to pay both alimony and child support if you are so ordered by the court. We can only assume that you want to continue providing that financial support to your children. This means you may have to make sacrifices in some other areas of your life in order to cut down on spending. Those parents paying support who also have a plethora of other debts and high living expenses can get pushed over the edge into bankruptcy. IMPORTANT NOTE: Child support is NOT dischargeable in bankruptcy.

Bankruptcy of your (ex) spouse: As noted above, your ex cannot file for bankruptcy to get out of paying child support. This is not to say that they are prohibited from filing for bankruptcy; they just cannot discharge their child support obligation. If your ex-spouse files for bankruptcy, they may be granted a discharge (wipe out) of other debts, like credit cards, store cards, past due utility bills, late fees, and more. Since you were previously married, there’s a good chance that your name is included on some or many of the debts that are discharged, turning the creditors’ attention directly toward you.

Creditors don’t care about your private life. You got divorced, so sorry, too bad, is what they’ll say. “Your name is still on this account, and we don’t care if you’re single, married, or a neon green unicorn, we’d like our money please.” The bankruptcy of your former spouse can have a domino effect that ultimately causes you to file for bankruptcy as well.

If you’ve recently been through a divorce and are struggling with a similar situation, you have options. If you own your own home and don’t want to lose it, filing for bankruptcy is the perfect way to save it. Learn more at: http://www.veitengruberlaw.com/Bankruptcy-Law/.

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Bankruptcy Law and Family Law: How They’re Connected

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Anyone who has been through a divorce knows that, second only to your love life, your finances are often the hardest hit area during a split. Many people continue to have financial difficulties long after their divorce is finalized, as well. Family lawyers who handle divorce cases know from experience that financial strife can be a huge contention between divorcing couples.

While your family law attorney will assist you in creating a Property Settlement Agreement that settles some of your money troubles (you may begin receiving child support or alimony payments after the divorce is finalized), oftentimes divorced couples will struggle with things like losing their family home to foreclosure, credit card debt, and potential bankruptcy.

As much as your divorce attorney may want to assist you with all of the above money matters, they have to focus their attention on everything within their own wheelhouse to ensure that you (and their other clients) achieve the desired outcome from your divorce. Their duties are many, and include drafting your PSA, attending court dates, negotiating and corresponding with counsel for your soon-to-be ex-spouse, handling domestic violence matters, and much more.

Frequently, family law attorneys find it very beneficial to work in tandem with an attorney who specializes in bankruptcy, real estate and/or debt relief. Because financial strain is a given in most divorces, it can be helpful for everyone involved to work as a team. Your divorce (family law) attorney will walk you through all of the steps of your divorce. With your permission, ideally he would then discuss your case with his tandem bankruptcy attorney, whom you would then work with to clean up your finances.

Of course, family law attorneys attend to matters other than divorce, like name changes, parenting time, grandparents’ rights, pre-nuptial agreements, child custody (unrelated to divorce), adoption, restraining orders, and domestic violence. Some of these matters can also be made easier by working with an attorney who specializes in finances. For example, the financial aspect of adoption matters can be quite intense. While your family law attorney will handle much of the adoption paperwork, he can refer you to a financial specialist like Veitengruber Law if you need more help organizing the necessary finances.

Every attorney has a lot on their plate every single day, regardless of their practice area(s). The best attorneys limit their focus to a limited number of practice areas so as not to get overwhelmed and spread too thin. If your family law attorney attempts to do it all himself, you may find that he’s too busy to set aside time to keep you updated on your case. On the other hand, a smart divorce lawyer will say, “Hey, while I’m working on negotiating your child visitation schedule, why don’t you go see George Veitengruber to start sorting out the fact that you can’t afford your mortgage payment?”

When attorneys work together, their clients always have a better result. Mutually beneficial relationships between experienced professionals give clients a well-rounded experience and optimal outcome. Veitengruber Law welcomes family lawyers in New Jersey (Monmouth, Ocean, Mercer, Burlington, Camden, and Gloucester Counties) to reach out to our firm if and when your clients need our services. We will gladly return the favor so that our mutual clients are well-cared for and happy with our services.

Image credit: Kamaljith KV

How to Achieve Financial Success with a Criminal Record

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A staggering 25% of Americans have a mark on their background check that is preventing them from being gainfully employed. In fact, for those with a criminal record, finding any kind of work has become next to impossible.

We’re not talking about murderers or bank robbers, either. Naturally, those more serious offenders are busy spending many years in prison. Meanwhile, one in four Americans is dealing with a criminal record from many years ago – sometimes even decades. These dings on their background checks were often petty crimes that took place when they were young and immature. Many who are affected by their past crime(s) say they haven’t been in trouble with the law since, having learned their lesson and lived a clean and honest life after a run-in with the the police. Regardless, they are still repeatedly turned away from job openings, have lost their homes, and many can’t even rent an apartment.

New Jersey, along with many other states, have recently passed legislation that prohibits employers from asking potential employees up-front about their criminal history. This Ban the Box law is aimed at reducing discrimination against applicants based on the fact that they have a criminal record. Employers are still allowed to inquire about criminal history, but only after the initial application and interview stage has passed. Even with the Ban the Box law in place, many employers will simply drop an applicant the second they find out that they have a criminal record.

What is a person to do if they’re dealing with an event from their past that they can’t seem to get out from under?

If the crime took place a long time ago and the applicant has maintained a clean criminal history since, it might be best for them to be up front about the event with potential employers. This is especially true if the crime was relatively minor, and most importantly, non-violent.

A good example of this is a man who fell behind on child support payments due to a cost of living increase. He was not made aware of the increase and was subsequently arrested. Upon arrival at his front door, the officers attempted to detain him, but the man had no idea what he had done wrong so he resisted. Now he is dealing with a count of Resisting Arrest on his criminal record. Employers who hear the whole story will be more inclined to understand rather than discriminate.

For those who still struggle to get work even when taking the honest approach, try applying at a temporary work agency. It may not be your ideal job, and it may not provide work every day, but it’s a step in the right direction. It’s important to get some work history under your belt after the date of the criminal event so that when you do apply for a steady job, employers can call your reference person (your temp agency coordinator or someone you worked for through the agency) to find out that you’re a hard worker who stays out of trouble these days.

If your financial situation has become dire due to being unable to find work, you might benefit from filing for NJ bankruptcy. This can give you a fresh start by eradicating your debts so that when you do finally land the right job, you’ll already be on the path to financial success.

 

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