Many people getting a divorce focus a great deal of energy on figuring out how to divide their assets, even in divorces that involve high net worth assets. In order to achieve a greater balance when it is all said and done, it would benefit such couples to think about their debt division at least as much as divvying up their assets.
Like property division, figuring out how the marriage’s accumulated debt might be split is important. Learning about marital debt issues at any time during a divorce is as beneficial as learning about property division assets. Here are a few ways some common marital debts are handled during a divorce.
Mortgage Debt: Often, mortgage debt is assigned to the spouse that makes the most money. Other options include selling the house or awarding the home to whoever has full custody of the children. If the home and its mortgage goes to either party, one spouse must buy out the other’s equity.
Credit Card Debt: When this kind of debt appears in joint accounts, it is most likely split fairly evenly between the two spouses. However, separate credit account debt is given to the person responsible for the account.
Medical Debt: As Connecticut is an equitable distribution state, medical debt is often handled like property division. This means the court will consider numerous factors before assigning medical expenses. Some of the factors include when the debt occurred (during the marriage or during a legal separation), whether it was “necessary care” and whether or not it might impact any children born of the marriage.
Unless you and your spouse are completely debt-free, splitting up the bills can become as complicated as issues involving property division. The best way to protect yourself from marriage debt you cannot handle is to consult with a divorce attorney about dividing these debts between you and your spouse.
Source: Time.com, “What Happens to My Debt If I Get a Divorce?,” Leslie Tayne, June 23, 2015