How a cheap divorce can lead to a bankruptcy nightmare.

February 13, 2020
How a cheap divorce can lead to a bankruptcy nightmare.
Kelly Bankruptcy
How a cheap divorce can lead to a bankruptcy nightmare.

Show Notes


Hello, this is Jeff Kelly. And in this podcast I would like to talk about how getting a cheap divorce can set you up for a possible bankruptcy disaster. Okay, the first way that I often see it and it’s usually in almost every case, the wife that’s left with the children is so desperate to get rid of nasty, horrible husband, that she will agree to anything without a lawyer. She signs the papers and literally gives everything to him. I cannot believe how often I see this situation.

Go get an attorney. There are some attorneys who will defend mothers with children and they’ll collect all the attorneys fees from the the ex husband so it’s really tragic sometimes when I you know, I see Women with kids come in and there’s just not enough money to make the mortgage payment not enough money to cover electricity bills. In those situations, you know, honestly, bankruptcy doesn’t help if we’re in a house that you need to stay in and the future mortgage payments are too high. Maybe man, I hate it. And in most cases, it’s almost impossible to go back and undo a bad divorce. It’s much better to get an attorney from the beginning and avoid those rough situations. Another thing that I see that’s often very common is people will, you know, do the no fault divorce, no attorney and one spouse will sign their interest in the house over to the other spouse, and they’ll do it in the form of a quitclaim deed and they’ll date it and they’ll do all the stuff the directions tell them to do but the one thing that They forget or don’t know about is they don’t go and get it recorded in the local courthouse and the deed and the deed records. And that is a potential disaster. And I’ve seen it happen you know, sometimes the divorce order isn’t crystal clear who’s a word of the house. Somebody goes and files chapter seven and chapter seven trustees do what all chapter seven trustee do they search for assets, they do a land search and Ding, ding, ding, ding, ding.

They find out that the person who’s in chapter seven has a half interest in a house with a lot of equity. And then, you know, when the other spouse pops up and says, Wait, I’ve got this quitclaim deed sitting right here in my hand. She signed it over to me long ago. Well, hey, you know what, if it’s never recorded, you’re going to have a big fight on your hands with the chapter seven trustee. total disaster and it’s a you know, the quitclaim deeds are a classic case of where being a cheapskate may save you a little bit of money in the short run, but can cost you big time in the long run. Another issue we often see come up in the divorce setting spills over into bank she is cosine lumps. And I it was so common for somebody to come in and meet with me and you know, we’ve got this viable case. But then we’re looking at you know, what is this cosine debt? What, what’s what’s going on here. And people most people who go through divorce think that if the divorce judge orders the other side to pay the cosine debt that relieves them of all civil liability, and that is absolutely not the case. Now, it is true that if the other side doesn’t They could get hauled back into divorce court for contempt for not paying it.

That is true. But that still doesn’t change your creditors right to go after both people who are co signed on the loan, doesn’t matter who’s first doesn’t matter who’s Second, the creditor gets to pick who’s the easiest target and that’s where they’re going to go after. Regardless of what the divorce order says they’re going to go after the easiest place to get the money. So kind of plain divorce and you’ve got a bunch of cosine debt, you need to make sure you understand everything before the order is finalised. Because maybe it might affect how you negotiate it might affect things you request. And a good divorce lawyer who’s trained and has experience can save you so much heartache in the future and keep you from getting set up for you know potential bankruptcy disaster. down the road.

Again, if that quitclaim deed is not recorded, it does. It might as well not even exist. It’s got to be recorded. And the best thing to do is get an attorney who knows what they’re doing to help you with that kind of thing. At my law office, we specialise in chapter 13 and chapter 7. I don’t do divorces at all. And I don’t do any real estate record stuff either. I know a lot of good Divorce Attorneys. If you need me to make a recommendation for you. I’d be happy to do that. But if you have debt hanging over your head and you need some help, give me a call at 770-881-8449 I’ve got office locations and Dalton, Dallas, Georgia, Douglasville Marietta cartersville Kennesaw and if you get a chance, check out my website got a lot of blog posts. They’re also got a podcast at and give us a shout. We offer free consultations. And I look forward to talking to you. I’ve got a great team of lawyers here and a really awesome staff.

Thank you very much for tuning in.

Episode Transcript

No transcript available...

Other Episodes

Episode 1

November 02, 2020 00:29:55

Radio Show #1 : Interview with Patrick Matson

Welcome to the first radio show with Jeff Kelly featuring guest Patrick Matson. Today we debunk the fears surrounding bankruptcy and ensuring that your bankruptcy experience is one that goes smoothly. ...



June 22, 2020

What happens to the credit score after bankruptcy?

Hello, this is Jeff Kelly. And in this podcast today, I’m going to talk about what happens to your credit score after bankruptcy. Am I doomed? For many years. What does my future look like? Will I ever be able to buy a new car at a decent interest rate? Will I ever be able to buy that house that I’ve always dreamed of? Is my financial future ruined forever as a bankruptcy attorney who has practiced in this area since 1998? I have heard questions like these hundreds of times. And the answer might shock you. The answer is this. Most people do recover within about two years, one to two years of filing Chapter 7 bankruptcy. How can that possibly be? You may say, well, first of all, usually by the time the clients come meet with me, the damage has already been done. Most potential clients have stopped paying credit cards. Many months ago, had cars repossessed. Been sued by creditors. Had wages garnished or had their house foreclosed. Any of these will put a major hit to your credit rating. For most people considering bankruptcy, like I said, the damage is already there. So the question is, what do we want to do going forward? Do you ever get a knot in your stomach when you think about your credit score? David, just feel sick to your stomach thinking about all that debt and the interest and late fees and just mess that’s hanging over you and it’s not going anywhere. Well, Chapter 7 might help make that pain ...



June 15, 2020

How to protect yourself from thieves in a Chapter 13 bankruptcy case

Hello, this is Jeff Kelly and Today is June the 15th 2020. And today I want to talk about how to protect yourself from theft in a chapter 13 with Every active chapter 13 debtor should open an account with, the cost is free, but the information you see could be worth a lot of money and save you from theft. Having an account with will allow you to see every single proof of claim that has been filed in your bankruptcy case and it will also allow you to verify that your chapter 13 payments are being received by the trustee. Years ago I had a client whose employer took money from her paycheck, but never sent it into the trustee. We caught the error and had to sue the employer to get the money paid. Having an account with allows you to catch stuff like this. Proof of claim is a form signed under oath, with supporting documentation that a creditor must file in a bankruptcy case in order to get paid. The proof of claim will tell the trustee the type of claim and the amount owed. If a creditor fails to file before the deadline in your case, they won’t get paid anything. For example, let’s say you had a car repossessed a few years ago, and owe the car creditor $10,000. If they fail to file a proof of claim on time, you will not have to pay that $10,000. Let’s change up the facts ...