People find themselves in need of bankruptcy protection for a wide variety of reasons. Credit card debt, mortgage debt, medical debt, student loan debt — these are all common types of debt familiar to people throughout Wisconsin. Another kind of debt that gets less attention is the cost of divorce.

If you’re going through a divorce or family dispute over child custody or property division, you may be looking at a lengthy and potentially expensive legal battle. Typically, with the parent-child relationship or the division of marital property in question, the stakes are high in these cases. Even after a favorable ruling, some people still have to file for personal bankruptcy to stay the hands of creditors.

A case in point is Oksana Grigorieva’s recent bankruptcy filing. The Russian pianist is Mel Gibson’s ex-girlfriend, and the former couple share a 4-year-old daughter. Grigorieva’s bankruptcy petition indicates that she has $48,000 in assets but only $10 in cash. Her debts, which are mostly legal fees accrued during her child custody dispute with Gibson, reportedly come to $430,000.

She filed for Chapter 13 bankruptcy, which stays the hands of creditors while the filer adheres to a court-approved repayment plan that usually lasts between three and five years. Chapter 13 is reserved for people who still have some means of paying down debt.

Grigorieva’s case is made more complicated by the legal settlement she reached with Gibson. More details of that settlement are available in the article we’ve linked to below.

If you want to learn more about debt relief in Wisconsin, our bankruptcy site is an excellent resource.

Source: Fashion Times, “Oksana Grigorieva Declares Bankruptcy,” Feb. 20, 2014