How Do Bankruptcy and Divorce Affect One Another in Texas?

 Posted on May 07, 2025 in Bankruptcy

Certain times in life test you to the limit, yet when you come out on the other side you may have more freedom and be better off financially. If you find yourself filing for divorce and bankruptcy at or around the same time, or are considering doing so, you are likely experiencing very tough times. Practically speaking, you will want to know whether it is even possible to file for divorce and bankruptcy around the same time, and how that would work. Because divorce and bankruptcy both affect your finances, filing for one will have a practical effect on the other. An experienced Conroe, TX bankruptcy attorney can advise you on how bankruptcy and divorce affect one another.

How Does Marital Debt Work in Texas?

Texas is a community property state, meaning that both assets and debts from the marriage are owned jointly in marriage, and divided equally in a divorce. If your spouse amassed most of their debt before the marriage, you will not be liable for that debt in a divorce. If they amassed most of that debt during the marriage, you would generally be liable for a portion of that debt. However, creditors can sometimes pursue community property to satisfy one spouse's debt. How much marital debt and how much individual debt you have separate from your spouse’s debt should factor into your decision about when to file for bankruptcy.

Should You File For Chapter 7 or Chapter 13 Bankruptcy Before Divorce?

There are many considerations that go into whether Chapter 7 or Chapter 13 is right for you. However, as it pertains to divorce, one important thing to keep in mind is that Chapter 7 bankruptcy is generally a much quicker process than Chapter 13. It only takes a few months, whereas Chapter 13 is a repayment plan that will take three to five years. All things being equal, if you want to file for bankruptcy before divorce, the shorter time period is likely to make filing for Chapter 7 a good idea. On the other hand, if your attorney advises you that Chapter 13 makes the most sense for you, you may want to file for divorce first, finalize the process, and then file for bankruptcy.

Another consideration is that filing jointly for Chapter 7 before divorce can save money through shared court costs and fees for one attorney and discharge joint debts, simplifying the divorce. However, this only makes sense if both parties are eligible and cooperative.

What Happens to Your Divorce When You File for Bankruptcy?

If you or your spouse (or both of you jointly) file for bankruptcy while divorce proceedings are pending, the automatic stay will affect your divorce. The automatic stay stops all collection efforts, and it puts the property division aspects of divorce proceedings on hold while the bankruptcy case proceeds.

Call a Conroe, TX Bankruptcy Attorney 

Filing for bankruptcy can be a financial fresh start, but it may also be stressful, especially at first. If, in the midst of filing for bankruptcy, you are also considering filing for divorce, you need the advice and guidance of an experienced Harris County, TX bankruptcy attorney who can help you navigate this decision. At The Fealy Law Firm, PC, attorney Vicky Fealy prides herself on helping good people through hard times. If this is your situation, you can call the office at 713-526-5220 for a free consultation to discuss the recommended legal route to address these challenges.