How To Divide Marital Debt In A Divorce When It Is In One Spouse's Name
One of the issues that must be agreed upon in a divorce is how you and your spouse will divide assets and debts. This is a simple task when there are no assets or debts; however, this is not usually the way it works. If your situation is complicated because you have no assets and all the debts you have are in your name alone, you will need to make sure these debts are evenly divided and that you are protected with the way the division is handled. Here are some tips to keep in mind.
Marital Debt Is Equal
Just like marital assets are equal, marital debt is also equal. In other words, each spouse should be responsible for 50% of the debt, no matter whose name it is in. If your spouse is trying to get off without being responsible for the debt because it is in your name, you will need to let your lawyer handle this for you.
Ways This Can Occur
There are a number of ways to divide debt that is listed in just one spouse's name, but some methods are better than others. A simple way would be to assign each spouse with certain debts. This would be stated on the divorce decree in a way that would attach certain debts to each spouse, and that spouse would be responsible to abide by the divorce decree. Unfortunately, this method is flawed. Just because the decree states that your spouse must pay a certain debt does not guarantee he or she will pay it. If they fail to pay the debt, you will suffer because the debt is in your name.
Because of this, many lawyers recommend splitting up debts by obtaining loans. With this method, your spouse would have to get a loan equal to the amount of debt he or she would be responsible for. The proceeds of the loan would go to pay off the debt so it is no longer in your name, and this would force your spouse to pay the debt off, simply because it would be in his or her own name. The downside to this method is that your spouse may not qualify for a loan if his or her credit is bad, which means this option would not work.
If you are struggling with any issue like this with your divorce, talk to a divorce attorney or go to a site like http://madisonlf.com to find out what the best ways would be to handle this.