"Kim has made it clear she wants full custody so if Kanye tries to fight her on that, the custody battle will be brutal," the informant said.
The insider added that the Keeping Up With The Kardashians star "won't back down" when it comes to her four little ones.
Together, the couple share daughters North, 7, and Chicago, 2, along with sons Saint, 5, and Psalm, 1 – who have stayed with their mom in Los Angeles as Kanye remained at his Wyoming ranch.
As their breakup continues to unravel publicly, the source added that Kim and momager, Kris Jenner, are "terrified" at being unable to control the situation.
"They know they cannot control Kanye, especially when he struggles with his bipolar disorder.
"So there is no telling what he's going to say publicly, last summer was an indicator of that," the informant said of the rappers breakdown struggling with his bipolar disorder.
The insider continued: "Kris cannot fully control this situation like she typically can with public scandals and she knows that.
"And Kim cannot fully rely on her mum to make it go away because there's no way to know exactly what Kanye will do."
"He knows so much about the family, things they would never want exposed. They are nervous what he will do with this information."
Kim opened up about Kanye's struggle with bipolar disorder last summer following his on-stage breakdown during his South Carolina presidential rally.
Now, the Yeezy mogul's mental health struggles could come into play during their split.
Family attorney Adam Michael Sacks told The Sun that Kanye's "mental health might affect their divorce" when it comes to their little ones.
"If she can prove that he has mental issues, she can make an argument that he shouldn't have joint custody.
"She could suggest that he sees the kids with monitors – if he's mentally unstable, he could only see the kids and she would make the big life decisions.
"And there's a very strong possibility that they could demonstrate he has issues, it would be justified that he doesn't have joint custody."
Celebrity divorce lawyer, Rebecca Zung, added that Kanye's mental health will be a big factor in court.
"Obviously if he is having mental issues she will have to bring them forward to the court, if he is unwilling to agree to a parenting plan that gives him less than 50-50.
"Then she will have to proceed to a trial and that will create a massive media spectacle.
"In order for her to try to prove that he shouldn't have the children 50 per cent of the time, she will likely have to ask that a custody evaluator be appointed," the attorney said.
Rebecca continued: "Custody evaluators are psychologists and so they can do psychological evaluations on the parents.
"The custody evaluator would then be tasked with creating a report which would also have a recommended parenting plan."
On Tuesday, reports that the reality star was officially being "done" with the rapper surfaced.
Multiple sources told Page Six earlier today: "Divorce is imminent. They are keeping it low-key but they are done.
"Kim has hired Laura Wasser and they are in settlement talks," it was added of the go-to attorney for celebrity breakups.
After years of being friends, the SKIMS founder and Kanye tied the knot in a luxurious Italian wedding in May 2014.
