Who does the bank come after if 1 party is bankrupt?

[Mamaof3]

not sure if anyone has been through this or knows what would happen.

our best friend is going through a divorce....it's getting fairly nasty as some divorces do...

She's asking for 55/45 split of the assets because she's going to look after the kids and reduced earning potential and whatever...He wants 50/50 or he's going to declare himself bankrupt and the $60K that they still jointly owe on their home loan will be her responsibility. That is, the bank won't come after him for the money but will go after her.

Do u know if thats possible? Or what would happen in this situation? She's asked me but i would have no idea how banks work in this situation....

 

[AUSPROP...]

what about the equity in the house? has he seriously looked into bankruptcy? he will be stuffed for years.

 

[Mamaof3]

i don't think he realises the consequences but my friend isn't too worried as he's the one pushing for the divorce whereas she wants to work it out

 

[grossreal]

hi kimanand
you can pm me if you wish and can give you friend some information and this type of thing is not for a board
the main thing here is for the split to be done with the bank not closing of either and they can do this without to much major issues.
usually people think this is the best way to go and divorce does usually bring the worst out of people but what needs to happen is for your person to talk to the lender first and work from there.
i would recommend that her ex does not go down the avenue that he is looking at at the moment
simple reason
divorced dads are one of the less assisted groups on our community and they have a very tough time of it both emotionally and financially
so he needs to set himself correct from the start and going bankrupt is the last place start.

 

[letiha]

I'd love to see him do that because then his bankrupty trustee would get involved in the Family Court stuff...messy messy messy. Obviously he does not understand what bankruptcy is.

He is just bluffing and he is the one who will loose EVERYTHING if he tries to go down this road. I'd tell her to see a solicitor, if she has he kids she will probably get more that 55%.

what a moron, she is better of without him. The only thing i would say is what is that 5% worth, if its not a lot it would almost be worth agreeing instead of getting a lawyer...they cost a lot.
also there is nothing she can do if he wants a divorce, he just has to serve the appropriate documents on her, she gets no say in this at all.

 

[weg]

He's probably bluffing because he's irrate that she wants 55/45.

I'd advise her to go the 50/50 just to keep things from going from bad to really nasty in the future.

If he doesn't go bankrupt and they fight it the legal fees for a small % extra will leave her worse off anyway.

 

[fernfurn]

If they have children under 15 the split will be 70/30 in her favour through the court taking into account all assets including his super

 

[Mamaof3]

really? both boys are under 15.
so is that the standard split with kids under 15? wow!

 

[letiha]

If they have children under 15 the split will be 70/30 in her favour through the court taking into account all assets including his super

That is not always true...each situation is different, you don't automatically get 70/30 because you have the kids.

 

[weg]

She needs to keep in mind that he could fight for joint custody also. He could very well do that if he wants to manipulate the situation to disadvantage her.

And I'm sure people are giving him lots of pointers too.

Mediation is probably her best starting point.

 

[Mamaof3]

i hear its not exactly that easy or quick to declare bankruptcy anyway...that true?

 

[Pushka]

It is probably easy to declare bankruptcy, but as always the devil is in the detail and it is the consequences of going bankrupt that are the most alarming.

 

[rugrat]

Is he even eligible to claim bankruptcy??

You can't just wake up one morning and decide that you want to. The first thing that will happen if he even tries is that an auditor will be sent in to assess to the situation. I think the banks would also have something to say about the situation.

I agree about trying to keep things as amicable as possible and would definitely suggest mediation - but neither party should have to give up 'everything' they would otherwise be entitled to simply to 'keep the peace'. Also there is so much more to be taken into consideration when kids are involved. Who is the main bread winner? If they both provide equal contribution or if one partner provides more monetary support then the other, the courts take this all into consideration. It is not just a simple matter of saying I don't want to pay child support, my ex, etc I will quit my job and declare myself bankrupt and live like a pauper to avoid it (cutting off your nose to spite your face).

Your friend should get in contact with legal aid (if eligible), community legal service or a family law lawyer and get some advice about what her rights are (there are some basic ones applicable to everyone, but much depends on specific circumstance). Knowing what her rights are, doesn't mean she has to fight tooth and nail for everything, but it will give her a better bargaining point to start with.

 

[Piston Broke]

If 60k is what's it's about, then there wont be much left after the process anyway, and they both be left with nothing but a mortgage debt.
And if that dont get paid, then no house either.

 

[letiha]

Is he even eligible to claim bankruptcy??

It is not just a simple matter of saying I don't want to pay child support, my ex, etc.

Also keep in mind that child support is something completly different to property settlement, Child Support is worked out seperatly and by a formula.