On behalf of Stange Law Firm, PC posted in Property Division on Wednesday, February 19, 2020.
As you move through each part of your divorce, you’ll eventually come to the point where you have to talk about dividing your property. One of the harder things to do is to talk openly about who should take on debt following your divorce, especially if that debt was created by both parties.
The biggest question couples have is how to divide those debts in a way that is fair and that releases them from further obligations. Dividing your debts may not mean much if you’re both still listed as potential payors, and it could mean that you would remain on the hook if the other party didn’t pay.
What’s the best way to divide your debt upon divorce?
To start with, think about who created which debts. You may be willing to take on a credit card full of debt if it was one that you used on your own during your marriage. Similarly, your spouse may agree to keep student loans created during your marriage or the debts they created and to pay those back after you divorce.
If you can, you may want to consolidate the debts that you take on or refinance them in your own name. That way, you and your soon-to-be ex-spouse won’t be liable for the other party’s debts if someone forgets to make a payment or goes into default.
Of course, one of the best methods to resolve issues with debt is just to pay it off before your divorce. It may take time to do so, but it will be much easier to divorce if no significant debts are in your names.