Divorce can cause you not only emotional stress but also financial stress. You may not have realized the extent of the financial responsibilities associated with a divorce, especially regarding debt.
Consider these three key aspects of debt division as you prepare for your divorce.
There is no division of your non-marital debt
The debt you or your spouse built during the marriage that was not in both of your names, not used for the benefit of the family or not paid for with joint funds is non-marital debt. For example, if you have a business credit card solely in your name or a business loan for your own business, these debts are not divided between you and your partner.
There is no division of your pre-marital debt
Any debt accrued before your marriage, such as student loans, is not considered in debt division. These types of debts are solely your or your spouse’s responsibility.
There is debt division of your marital debt
The debt created during your marriage and used for the family is marital debt. This kind of debt is subject to division among both parties during a divorce. Typical examples of marital debt include your joint credit cards and house mortgage.
There are some exceptions to dividing your marital debt. An example is if you can prove that your spouse was the sole user of a joint credit card used for non-family purchases, the debt may become the sole responsibility of your partner.
A pivotal role of your lawyer can be to find hidden assets and take on less marital debt from your partner. Having a solid legal team in your corner can help improve your financial outcome and make your divorce a smoother experience.