Marital asset division is one of the most notorious areas of divorce, but it is not only a couple’s property that must be divided - their debts must be divided as well. Over the course of a marriage, couples can include substantial debt together. Indeed, couples may accumulate more debt than property. Jointly owned credit cards, mortgages, student loans, and home equity lines of credit are all common in modern marriages and must be dealt with in divorce.
As with the asset division process, Illinois courts are concerned with dividing marital debt in a way that is equitable rather than precisely equal. Understanding what this is likely to mean for you can help you prepare for your divorce and set yourself up for success in the future.
If either spouse has debt before the marriage begins, that debt usually remains the responsibility of that same spouse if the marriage ends. But with few exceptions, debt accumulated by either spouse during the marriage will be considered marital debt. Medical expenses, investment debt, student loans, and small business loans are all common types of marital debt. Even a car loan taken out by one spouse and used exclusively for their benefit is considered marital debt.
Prenuptial agreements, which are written prior to marriage to address how a couple’s finances will be handled in a divorce, can detail provisions regarding how certain debts will be dealt with. For example, if one spouse owns a business before the marriage begins, a prenuptial agreement can state that debt accrued by the business (or by the spouse during the operation of the business) remains the sole responsibility of that spouse.
Dividing debt equitably in a marriage necessitates the consideration of each spouse’s overall financial picture. When possible, judges will try to balance debts with assets so that spouses are not faced with an insurmountable debt burden once the divorce is over.
Couples or individuals considering divorce would be wise to reduce their debt before the divorce begins. This reduces the items which must be negotiated and allows each spouse a greater chance of financial success after divorce. Spouses who can work together amicably might also consider ways to split and settle their debt, such as by selling their home or using cash savings to pay down balances.
Spouses who are surprised to find that their partner has accumulated substantial debt without their knowledge may be able to prove to the court that they did not consent to the debt and should not be held liable for it.
The complications of dealing with debt in your divorce can seem overwhelming, but an experienced DuPage County divorce attorney with [[title]] can explain the process so you understand your options. We will advocate passionately for your interests and help you negotiate an equitable divorce settlement. Contact our office today to schedule your free and confidential consultation. Call us at 630-932-9100.
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