FAMILY LAW AND BANKRUPTCY
Divorce is hard enough on its own. But when financial challenges enter the picture, it can feel overwhelming. If you’re facing divorce and struggling with debt, unpaid bills, or creditor pressure, the decisions you make now could have long-lasting consequences.
At Rabinowitz, Lubetkin & Tully, LLC, we help individuals and families in New Jersey and the New York metro area navigate the complex intersection of bankruptcy and divorce law. Our goal is to give you clarity, protect your assets, and help you make the choices that will safeguard your financial future.
Why Divorce and Bankruptcy Require Specialized Guidance
Divorce and bankruptcy are both legally and emotionally complex. When they overlap, the challenges multiply. Bankruptcy law is designed to give debtors a “fresh start,” while family courts focus on protecting the financial well-being of both spouses and children. These goals can sometimes conflict.
Questions our clients often ask include:
- Should I file for bankruptcy before, during, or after my divorce?
- Which debts can be discharged, and which obligations will remain?
- How will bankruptcy affect the division of marital property?
- Will my divorce proceeding continue if I file for bankruptcy?
Making these decisions without experienced counsel can lead to mistakes that may affect your financial stability for years. That’s where our firm comes in.
Understanding the Automatic Stay
When you file for bankruptcy, an “automatic stay” immediately halts most collection activity. This can provide temporary relief from:
- Harassing phone calls from creditors
- Lawsuits or judgments
- Wage garnishments
- Foreclosure or eviction proceedings
However, not all divorce-related issues are stopped by the automatic stay. Child support and alimony obligations continue, while disputes over property division may require court approval or a motion for relief from the automatic stay.
Our attorneys help you understand:
- What the automatic stay can and cannot stop
- When stay relief might be necessary to continue your divorce proceedings
- Which court — bankruptcy or family court — is best positioned to resolve specific issues
This knowledge allows you to make informed decisions that protect your rights and assets.
How Bankruptcy Affects Property Division
If you are in the middle of divorce proceedings and filing for bankruptcy, the status of marital assets and property division can become complicated.
Some common concerns include:
- Can your spouse make a claim against the bankruptcy estate?
- Are jointly held assets considered part of the bankruptcy estate?
- Will the bankruptcy trustee sell assets before property division is resolved?
At RLT, we provide guidance that helps both filing and non-filing spouses understand their rights. By anticipating these issues, we help protect your property and ensure fair outcomes.
Discharge of Divorce-Related Debts
One of the most important considerations is which debts can be discharged in bankruptcy.
- Non-dischargeable debts: Child support, spousal support, and certain tax obligations
- Potentially dischargeable debts: Property settlements, joint marital debt, and some hold-harmless obligations
We help you identify which debts you can eliminate and which obligations will remain, so there are no surprises after your bankruptcy case concludes.
Clients often ask:
- Can bankruptcy eliminate joint marital debts?
- Will filing for bankruptcy affect my alimony or child support?
- Can property settlements be discharged?
We provide clear answers and a strategy tailored to your situation.
Timing Is Everything
The timing of a bankruptcy filing can dramatically affect your divorce outcome.
- Filing before divorce can simplify debt allocation but may complicate property division.
- Filing during divorce may disrupt proceedings but provide leverage in negotiations.
- Filing after divorce may leave you responsible for obligations that could have been addressed earlier.
We work closely with clients — and often with their family law attorneys — to develop a plan that maximizes protection and minimizes risk.
Protecting Non-Filing Spouses
Not everyone affected by a bankruptcy is the one filing. Non-filing spouses often have important questions, such as:
- How will my spouse’s bankruptcy affect me?
- Will I still be responsible for joint debts?
- Can I challenge the discharge of property or other obligations?
We represent non-filing spouses as well, helping them protect their rights and ensure fair treatment in both bankruptcy and divorce proceedings.
Coordinated, Compassionate Guidance
At RLT, we understand that financial and family stress can be overwhelming. That’s why we take a coordinated, hands-on approach:
- We work closely with your family law attorney to align strategies
- We explain complex bankruptcy rules in plain language
- We develop practical solutions that protect both your legal and financial interests
Our goal is to reduce uncertainty, protect your assets, and guide you through this challenging time with confidence.
Serving Clients Across New Jersey and the New York Metro Area
From our offices in Livingston, New Jersey, we help clients throughout Essex, Morris, Bergen, and surrounding counties, as well as the New York metropolitan area. Whether you are the spouse filing for bankruptcy, the non-filing spouse, or an attorney seeking experienced counsel, we provide practical, strategic, and compassionate guidance.