Bankruptcy after divorce can wipe out credit cards, medical bills and other debts assigned to you, but it will not erase child support or spousal support, and in Chapter 7 it generally will not erase what you owe your former spouse under the property settlement. Joint debts and the timing of your filing can also affect your ex, so both deserve careful planning.
Divorce often leaves one person holding more debt than one income can carry. If that describes your situation, you can call (415) 754-0115 to schedule a free consultation, or request one online, and bring your judgment and settlement agreement so an attorney can read exactly what you were ordered to pay.
Three kinds of divorce debt, three different outcomes
The first task is to sort what you owe by where the obligation came from. The Bankruptcy Code treats each category differently.
Support: never discharged
Child support, spousal support and other "domestic support obligations" survive every type of bankruptcy. They are also priority debts, so in a Chapter 13 case past-due support must be paid in full through the plan and ongoing support must be kept current. Collection of support from property that is not part of the bankruptcy estate, such as through wage withholding, generally continues despite the automatic stay.
Obligations to your ex under the property division: Chapter 7 versus Chapter 13
California divorce judgments often include an equalization payment, or an order that one spouse pay a joint card and "hold the other harmless." These are debts owed to your former spouse that are not support.
In Chapter 7
Debts to a former spouse arising from a divorce decree or separation agreement are not dischargeable, so the obligation to your ex remains even if the underlying creditor's claim against you is wiped out.
In Chapter 13
Non-support property settlement debts to a former spouse can generally be discharged on completion of a Chapter 13 plan. This is one of the most important differences between the two chapters for divorced filers, and it is a reason an attorney may look closely at Chapter 13 even when Chapter 7 is available.
Ordinary debts to third parties
Credit cards, personal loans and medical bills in your name are usually dischargeable in the ordinary way. Our article on what debts are discharged in Chapter 7 covers the general rules.
Joint debts: why your divorce judgment does not bind the bank
A family court can assign a joint credit card to your ex, but the card issuer was not a party to the divorce. If both names are on the account, the creditor can still collect from either of you. That creates two common situations:
- Your ex files bankruptcy. Your ex's personal liability to the creditor may be discharged, and the creditor then turns to you. Depending on the chapter, you may still have a claim against your ex under the hold-harmless order.
- You file bankruptcy. Your liability to the creditor may be discharged, but the creditor can pursue your ex, and your ex may come back to you under the judgment, especially after a Chapter 7.
Refinancing or closing joint accounts during the divorce avoids much of this, but it is not always possible.
Timing bankruptcy after divorce
When to file is often as important as whether to file.
Filing before the divorce is final
In California, community property generally becomes part of the bankruptcy estate when either spouse files, even if only one spouse is the debtor. The automatic stay also stops the family court from dividing that property until the bankruptcy court allows it. A joint case, filed while still married, can sometimes resolve shared debts in one proceeding.
Filing after the judgment
Once the property is divided, your separate property and your own debts are clearer, and your household size for the means test reflects your new situation. Many people find the case simpler to prepare. The trade-off is that obligations to your ex under the judgment are now fixed.
Transfers made in the divorce
A trustee can look at property transfers made in the period before filing. A settlement that gave away significant assets for little in return may draw questions, so disclose the entire settlement to your attorney.
Our article on filing without your spouse in California explains how community property rules work when only one spouse is the debtor.
How the house fits in
If you kept the family home but the mortgage is still in both names, or you owe your ex a buyout, your options depend on the equity, the loan and the payment history. Chapter 13 can cure mortgage arrears over time, while Chapter 7 relies on California's homestead exemption to protect equity. If you have already fallen behind, foreclosure timelines may drive the decision.
Bob Somal handles bankruptcy and foreclosure defense for individuals in Pleasanton, Dublin, Livermore, San Ramon, Danville and across the East Bay. Because the divorce itself runs through family court, it often helps to coordinate timing with your family law attorney as well.
Frequently asked questions
Can I stop my ex from collecting an equalization payment by filing Chapter 7?
Generally no. That type of obligation usually survives a Chapter 7 discharge, although the automatic stay may pause some collection temporarily.
Will bankruptcy reduce my child support?
No. Support is set by the family court. Bankruptcy can, however, leave more of your income available by eliminating other debts.
My ex filed bankruptcy. Can creditors come after me?
On joint debts, yes. You may want advice on your own options, including whether your claim against your ex survives.
Should we file jointly before the divorce is final?
Sometimes that works well, but it requires cooperation and aligned interests. An attorney can review whether it makes sense.
Divorce reshapes your finances; bankruptcy can help reset them, if the timing and chapter are right. Call The Somal Law Firm at (415) 754-0115 or request a free consultation online. Bring your judgment, your settlement agreement and a list of joint accounts, and you will get a straight answer about what can and cannot be discharged.
Attorney Advertising. This article is general legal information for Bay Area residents, not legal advice, and does not create an attorney–client relationship. Every situation is different — please consult a licensed attorney about your specific circumstances.