Divorce and Bankruptcy in Hawaiʻi: Which One Comes First?
This guide is legal information, not legal advice, and reading it does not create an attorney-client relationship. Every situation is different, and the right move in your case depends on your facts. For advice about your own situation, start with my free questionnaire or call me at (808) 468-7000.
I work hard to keep this page accurate, but errors or omissions are possible and the law can change. The information here is current only as of the date above.
Should you file bankruptcy before or after a divorce in Hawaiʻi?
The order matters for three reasons: whether you can still file one bankruptcy case together, what happens to property a divorce decree gives you, and which debts each chapter erases. Filing while you are married is the only way to file jointly. Property a divorce decree or a settlement agreement gives you within 180 days after a Chapter 7 filing belongs to the bankruptcy estate. And money you owe your former spouse that is not support survives a Chapter 7 while a completed Chapter 13 erases it.
A divorce decides who is responsible for what. A bankruptcy decides what is erased. Those two answers do not always match.
Key Takeaways
- You have to still be married to file one bankruptcy case together. After the divorce it is two cases and two filing fees.
- Property a divorce decree or a settlement agreement gives you within 180 days after a Chapter 7 filing belongs to the bankruptcy estate.
- Filing bankruptcy does not stop your divorce. Only the division of estate property pauses.
- Your divorce decree does not bind your creditors. A Hawaiʻi family court can allocate debts between you, but that order does not reach the companies you owe.
- Support always survives. Non-support divorce debt depends on the chapter. It survives a Chapter 7, and a completed Chapter 13 can erase it.
- A bankruptcy discharge protects you and no one else. Your former spouse stays liable on a joint debt in either chapter.
Which Comes First, the Divorce or the Bankruptcy
Whether to file bankruptcy before or after a divorce in Hawaiʻi comes down to what you owe, who else is on it, and how close the divorce decree is.
A note on scope: I am a bankruptcy attorney and I do not handle divorces. What follows is the bankruptcy side of the decision. Your divorce lawyer handles the decree itself.
Filing while you are still married is the only way to file one bankruptcy case together. Federal law lets a husband and wife file jointly. Once the divorce is final it is two cases and two filing fees.
Filing together clears the debts you both owe at once, so the divorce decree has less to divide and neither of you is left exposed on the other’s debt.
Property a Divorce Decree Gives You After You File Bankruptcy
Property you become entitled to receive within 180 days after a Chapter 7 filing belongs to the bankruptcy estate. It does not have to be a final decree that gives it to you: an interlocutory decree counts, and so does a property settlement agreement with your spouse. The estate is otherwise measured on the day you file for bankruptcy. A Chapter 13 works differently, because property you acquire at any point while that case is open comes into the estate, so the 180 day line is a Chapter 7 line.
Your exemptions still apply, so this is not automatically a loss. It does mean knowing the divorce decree’s likely timing before you file for bankruptcy.
A Chapter 13 does not liquidate property, so nothing is sold. The value still counts, because unsecured creditors have to receive at least what they would have received in a Chapter 7.
Filing Bankruptcy Does Not Stop the Divorce Itself
Filing a bankruptcy case does not stop a divorce from going forward. The automatic stay is a federal injunction, meaning a binding legal order, that halts collection the instant your bankruptcy case is filed, and federal law puts divorce outside its reach.
The same is true of custody, visitation, paternity, domestic violence, and the establishment or modification of support. Support collection continues too, including withholding from your pay. My guide to wage garnishment covers why support keeps running when other garnishments stop.
One piece does pause: the family court cannot divide property that belongs to the bankruptcy estate. That carve-out sits in the same statute, and dividing estate property takes permission from the bankruptcy court.
Your Divorce Decree Does Not Bind Your Creditors
A Hawaiʻi family court can order which of you is responsible for which debt, and that order binds the two of you without binding the companies you owe. The statute lets the court allocate the debts of the parties between the parties, and says nothing about the creditor.
If your name is on a joint account, the creditor can still collect from you no matter what the divorce decree says. Your remedy is against your former spouse in family court, which does not help while the letters arrive.
That is why a hold harmless promise is worth less than it reads. Your former spouse agrees to pay a joint credit card and to hold you harmless if it goes unpaid. If they stop paying, the company comes to you, and the promise is itself a debt they owe you.
Support and Non-Support Divorce Debt
Bankruptcy splits divorce obligations into two kinds, and not by what the divorce decree calls them.
The first is a domestic support obligation: child support, alimony and anything else in the nature of support. Support survives every bankruptcy, in every chapter. My guide to debts that cannot be discharged covers the rest of the survivors.
The second is everything else you owe your former spouse out of the divorce: a cash payment to even out the property split, an order to pay a joint debt and hold them harmless, an award of their attorney fees, depending on what the fees were for. I call it non-support divorce debt.
The line is drawn by what an obligation does, not by the label the divorce decree puts on it. Federal law defines support to include a debt in the nature of support without regard to whether it is expressly designated as support.
Why the Chapter You File Changes the Answer
The chapter of bankruptcy you file changes the answer for divorce debt in three places.
| Chapter 7 | Chapter 13 you complete | |
|---|---|---|
| Child support and alimony | Survives | Survives |
| Support you are behind on | No way to catch up inside the case | Paid through the plan over three to five years |
| Non-support divorce debt | Survives | Can be erased |
| A joint debt your former spouse is also on | Your former spouse still owes it, and the creditor can collect from your former spouse now | Your former spouse still owes it. Creditors must stop collecting from them while your bankruptcy case is open, and only for the part your plan pays in full |
Non-support divorce debt survives a Chapter 7 and can be erased in a Chapter 13 you complete. The Chapter 7 discharge comes with a list of exceptions and this debt is on it. The discharge for completing a Chapter 13 plan has a shorter list, and this debt is not on it.
That result depends on finishing the plan. If it is not finished and the court grants a discharge on hardship grounds instead, the longer list applies again and the debt stays yours. It also depends on staying current on support after you file, because a plan cannot be approved and a discharge cannot be entered while support payments are behind.
Support arrears are the second place. A Chapter 13 plan generally has to pay priority claims in full and support sits in first priority, so what you are behind on is paid over three to five years while you keep current. A Chapter 7 does nothing for arrears.
A joint debt your former spouse is also on is the third, and the protection is narrower than it sounds. Chapter 13 has a co-debtor stay that stops a creditor from collecting a consumer debt from someone liable on it along with you. It runs while your Chapter 13 case is open, and it ends if the case is dismissed or converted to a Chapter 7. It covers only the part of the debt your plan pays in full. And if your former spouse is the one who got what the debt paid for, which a divorce decree often arranges, the court has to lift the protection when the creditor asks. Chapter 7 has none. Either way your former spouse still owes the debt, because a discharge ends your liability and nobody else’s.
My comparison of Chapter 7 and Chapter 13 covers the rest of that decision, which rests on income and property.
Let’s talk about your options.
I have helped more than a thousand people through bankruptcy in Hawaiʻi. Tell me what you are dealing with and I will tell you what you may qualify for: Chapter 7, Chapter 13, or another path entirely.
The Home You Own Together
In Hawaiʻi, a married couple whose deed holds the home as tenants by the entirety have a protection most owners do not. Property held that way is generally shielded from unsecured debts either spouse owes alone. It does not stop a federal tax lien, which can reach the property even when only one of you owes the tax. Hawaiʻi law lets reciprocal beneficiaries hold title the same way.
A divorce can end that protection. It depends on the marriage rather than the property, so the shield has an end date. In a bankruptcy it also depends on choosing the Hawaiʻi exemption set rather than the federal one, and in a joint case the two of you have to choose the same set.
My guide to Hawaiʻi bankruptcy exemptions explains how it works and what it does not cover.
If Your Husband or Wife Filed Bankruptcy and You Did Not
If your spouse or former spouse filed bankruptcy and you did not, the discharge is theirs alone. Federal law says it does not affect the liability of anyone else on the debt.
On a joint debt, the creditor can now look to you alone. It cannot pursue your former spouse, so it pursues the person still on the account.
Support runs your way. Child support and alimony your former spouse owes you survive their bankruptcy in every chapter, and the stay does not stop you from collecting.
Non-support divorce debt your former spouse owes you is the piece that can disappear. It survives their Chapter 7. If they complete a Chapter 13 plan it can be erased, and you receive only what the plan provides.
What to Do if Both Are on the Table
If a divorce and a bankruptcy are both in front of you, a few facts settle the sequence.
- Find out where the divorce decree stands. Whether it has been entered, and whether it left the property division for later, changes what a bankruptcy filing does.
- List every debt you are both on. That is where the divorce decree and the bankruptcy pull against each other.
- Separate support from everything else you owe your former spouse. They are two different obligations under the discharge rules.
- Look at what the divorce decree gives you, and when. Property arriving within 180 days of a Chapter 7 filing belongs to the estate, and in a Chapter 13 the window is the whole case.
I work with people on every island, by phone or video, whether you are on Oʻahu, Maui, Kauaʻi, Molokaʻi, Lānaʻi or Hawaiʻi Island.
You do not need to work out the sequence before you call. Sorting that out is my job.
Frequently Asked Questions
Should I file bankruptcy before or after my divorce in Hawaiʻi?
It depends on your joint debts and on the timing of the divorce decree. Filing while you are still married is the only way to file one bankruptcy case together, and it clears the joint debts for both of you at once. Filing first also means that property a divorce decree or a settlement agreement gives you within 180 days after a Chapter 7 filing belongs to the bankruptcy estate. Those two points usually decide the sequence.
Can my spouse and I file bankruptcy together if we are getting divorced?
Yes, as long as you are still married on the day the bankruptcy case is filed. Federal law allows a joint case for an individual and that individual’s spouse. Once the divorce is final it has to be two separate cases, with two filing fees and two sets of schedules.
Does filing bankruptcy stop my divorce?
No. Federal law lists the dissolution of a marriage among the proceedings the automatic stay does not reach, along with custody, visitation, paternity and the establishment or modification of support. The one part that pauses is the division of property that belongs to the bankruptcy estate, which takes permission from the bankruptcy court first.
Can bankruptcy erase child support or alimony?
No. Domestic support obligations survive every bankruptcy, in every chapter. What bankruptcy can do is erase the debts around them, so more of your income is available for the support you owe, and a Chapter 13 plan can pay off support arrears over three to five years.
Can bankruptcy erase what I owe my former spouse in the divorce decree?
It depends on the chapter and on what the obligation is. Support survives both chapters. Non-support divorce debt, which covers a cash payment to even out the property split, an agreement to pay a joint debt and hold your former spouse harmless, or an award of your former spouse’s attorney fees depending on what the fees were for, survives a Chapter 7 and can be erased in a Chapter 13 you complete. It is not erased if the case ends in a hardship discharge instead.
My divorce decree says my former spouse pays the joint credit card. Am I still responsible?
Yes, as far as the credit card company is concerned. A Hawaiʻi family court can allocate the debts between the two of you, and that order binds you and your former spouse without binding the creditor. If your name is on the account and your former spouse stops paying, the company can collect from you, and your only remedy is back in family court.
My former spouse filed bankruptcy. Am I now responsible for our joint debts?
On a joint debt, yes. A discharge ends your former spouse’s liability and does not affect yours, so the creditor turns to the person still on the account. If your former spouse filed a Chapter 13, its co-debtor stay can hold the creditor off while that bankruptcy case is open, but only for the part of the debt the plan pays in full.
Does my former spouse’s bankruptcy wipe out the child support they owe me?
No. Support survives every chapter, and the automatic stay does not stop you from collecting it. A Chapter 13 gives your former spouse a structured way to pay off what is behind, because the plan generally has to pay support arrears in full. That is the rule rather than a guarantee, since a support holder can agree to different treatment and a narrower exception exists for support that has been assigned to a government agency.
Key Terms, Explained
- Domestic support obligation
- The law’s term for child support, alimony and anything else in the nature of support. It survives every bankruptcy, and what the divorce decree calls it does not control.
- Non-support divorce debt
- Everything else you owe your former spouse out of the divorce, such as a cash payment to even out the property split, an agreement to pay a joint debt and hold your former spouse harmless, or an award of your former spouse’s attorney fees depending on what the fees were for. It survives a Chapter 7 and can be erased in a Chapter 13 you complete.
- Automatic stay
- A federal injunction, meaning a binding legal order, that takes effect the instant a bankruptcy case is filed and halts collection. It does not reach the divorce itself.
- Bankruptcy estate
- Everything you own on the day you file for bankruptcy, plus a short list of property that arrives later, including, in a Chapter 7, property a divorce decree or a settlement agreement gives you within 180 days of that filing.
- Co-debtor stay
- A Chapter 13 protection that stops a creditor from collecting a consumer debt from someone liable on it along with you. It runs while the Chapter 13 case is open, ends if the case is dismissed or converted to a Chapter 7, and covers only the part of the debt the plan pays in full.
- Joint case
- One bankruptcy case filed by a husband and wife together. It requires that you still be married on the day the case is filed.
- Tenancy by the entirety
- A form of title Hawaiʻi allows a married couple, and also reciprocal beneficiaries, to hold. It generally shields the property from unsecured debts either spouse owes alone. It does not stop a federal tax lien, which can reach the property even when only one of you owes the tax.
Sources & Legal Authorities
The authorities behind this guide.
- United States Code. 11 U.S.C. § 101(14A); § 302(a); § 362(b)(2); § 362(d); § 507(a)(1)(A); § 522(b)(1); § 522(b)(3)(B); § 523(a)(5); § 523(a)(15); § 524(e); § 541(a)(5)(B); § 1301(a)(2); § 1301(c)(1); § 1301(c)(2); § 1306(a)(1); § 1306(a)(2); § 1322(a)(2); § 1322(a)(4); § 1325(a)(4); § 1325(a)(8); § 1328(a); § 1328(a)(2); § 1328(b); § 1328(c)(2); 26 U.S.C. § 6321
- Hawaiʻi Revised Statutes. HRS § 509-1; § 509-2(a); § 580-47(a)
- Cases. Sawada v. Endo, 57 Haw. 608, 561 P.2d 1291 (1977); United States v. Craft, 535 U.S. 274 (2002)
