For some divorcing couples, the so-called housing crisis increases the woes and worries associated with the collapse of a marriage. "The traditional reasons for bankruptcy -- illness, divorce and job loss -- have not gone away," said one expert and personal finance. "With houses no longer A.T.M. [automated teller machine] for paying bills, that escape route is gone."

Grim as it may be to contemplate, many couples will face not only marital collapse but also financial ruination at a time when the housing bubble of first decade of the new century continues to deflate and leaves in its wake declining housing prices that press overextended owners in the vise of negative marital home on the overstocked market, it may be some time before a buyer comes along -- and one in a position to buy at a much lower price than they imagined.

That said, bankruptcy is fact of modern life, and many people relief from bad decisions and just plain bad luck in a bankruptcy court.

Depending on the type of file and takes longer to work out.

As a result of legislation pushed by the finance industry in 2005, more and more people now file Chapter 7, although it is rare that people with less than $100,000 to not pass the means test. For those who do not pass the means test, Chapter 13 may be the only remedy, particularly for wealthy bankrupts who own houses worth less than they owe or who have unmanageable unsecured debts.

The legal fees of a Chapter 7 bankruptcy must be paid upfront in cash. "You can be too poor to go bankrupt," said one bankruptcy lawyer.

And some debtors who seek reorganization under Chapter 13, which has real estate lawyer.

For those who cannot use Chapter 7 or Chapter 13, Chapter 11 is the only recourse, but it is intended for business and more expensive than chapters 7 or 13.

Property in bankruptcy is administered for the assets to distribute to the creditors.

Most individuals and couples forced into bankruptcy go through Chapter 7 or 13. Chapter 7 is a "straight" liquidation in which the order. The bankrupt is permitted what are called "debtor’s exceptions," which vary by state. After all this is done, which normally takes less than six months from filing to completion, the debts are said to be discharged.

In Chapter 13, individuals or couples reorganize and repay in a routine known as an "adjustment of debts of individual with regular income" over a three-to-five-year period. Secured creditors are paid first, unsecured creditors last.

In both cases, however, once the bankruptcy attorney fees cannot be discharged by bankruptcy.

As long as the marital property has not been divided, "[t]he entire community comes into the bankruptcy spouse files after the martial statis has been severed..."

Some special considerations must be held in mind. Generally pensions, including plans subject to Retirement Plans are not subject to bankruptcy proceedings.

In divorce actions, spouses must contemplate the impact of a possible bankruptcy on the settlement because a bankruptcy after a divorce can derange the terms of the action.

Before 1994, only spousal and child debtor that outweighs the detrimental consequences to the spouse."

In dealing with the discharge of property settlement claims through bankruptcy, the courts use a two-prong test: 1) the so called "disposal income tax" (Does the debtor outweigh the consequences to the former spouse?) But even if Rufus’s bankruptcy is valid and legitimate (as opposed to an attempt to defraud Rhonda), she could be a very hard place. In this situation, Rhonda would be wise to negotiate language in the basis to ask for alimony.

Sometimes, bankruptcy courts have imposed equitable liens when it is clear that a former spouse, acting in bad faith, seeks to avoid compliance with a property division by bankruptcy.

Bankruptcy is a course of last resort because it can take years for a bankrupt to restore his or her credit rating.

Resources: Consumer Credit Counseling is available all over the United States. Check the yellow pages.