Question: I have been left no alternative after being seperated and receiving no interim settlement then to declare bankruptsy. I have one question. When we finally do settle our financial matters from the divorce, will the money I get from the settlement I receive, will it be seized as part of the bankruptsy? I might have a sum of approx $75,000.00.
Thanks
Answer: In most cases, yes, if you receive a large sum of money while you are bankrupt, the money will be seized and distributed to your creditors. If you owe less than $75,000, you probably don’t want to go bankrupt, because when you receive the money you can pay your creditors directly. If you owe more than $75,000, bankruptcy may be the correct option. A trustee can explain the implications and help you decide whether or not bankruptcy is the correct option in your situation.