Bankruptcy Law Questions? Ask a Bankruptcy Lawyer Now.
What would the judgment be for? And if you cannot make the payments on the mortgage, what would she be able to do with the judgment?
The divorce decree reads: "...each party agrees and it is ordered that if any claim, action, or proceeding is hereafter initiated seeking to hold the party not assuming a debt, an obligation, a liability, an act,or an omision of the other party liable for such a debt, liability, etc...the other party will at his or her sole expense defend the party not assuming the debt,...etc. against any debt of the other party against any such claim or demand and will imdemnify the party not assuming the debt and hold him or her harmless from all damages resulting from the claim or demand (please note that I agreed to assume the 2 mortgages in question).
Let's say I file for bankruptcy and discharge the SBA loan, then the SBA can choose to go after her (the guarantor) for payment. At that point, she can then turn around and sue me for damages (as per the imdemnity clause above). A judgement coming from such lawsuit will enable her to place liens on any future property, bank accounts etc. impairing my future ability to do business. My question to you is: is there a way to protect myself from such actions/events? Thanks!
If the only way to protect her from liability for the SBA loan - because you cannot make the payments - is for her to cooperate with the procedure to take her name off the loan, and she will not cooperate, you will be able to use the defense of "impossibilty" if she sues you for exposing her to liability for this debt.
In other words, if she sues you, you will be able to defend yourself with the fact that she made it impossible for you to comply with the decree.
I don't see any other way for you to protect yourself.
Yes - basically anything regarding a divorce is dischargeable except support or alimony. However, if you file a Bankruptcy before the judgment is gotten, you would want to list that liability, because this (the Bankruptcy) will provide another defense to the judgment.