Bank finance articles and tips

In general, Chapter 7 bankruptcy will discharge a debtor's pre-petition debts with a few exceptions. One of those exceptions includes debts related to divorce; however, there are some divorce related debts which can be discharged in bankruptcy.

Two of those exceptions apply to domestic obligations. First, debts (a) owed by a debtor to his former spouse, (b) arising under a divorce decree, and (c) in the nature of alimony, maintenance, or support are non-dischargeable under ? 523(a)(5). Second, marital debts that are not support obligations are non-dischargeable under ? 523(a)(15), unless (a) the debtor is unable to pay such debts, and (b) the benefit that the debtor would receive from the discharge would be greater than the harm that the discharge would cause to the non-debtor spouse. Whereas ? 523(a)(15) "requires the Court to review the impact of the obligations on the current circumstances of the parties and consequences of the discharge of those obligations on both parties," subsequent events are irrelevant to the ? 523(a)(5) inquiry....