How To Divide Marital Debt During Divorce
Most people know that when they get a divorce, marital assets are divided between the spouses. Marital assets include any property the couple acquired together during the marriage. Although dividing marital assets can be difficult, dividing marital debts can present even more challenges. It is not uncommon for spouses to try to shield themselves from incurring debt during the divorce process, especially when they believe they did not incur the debt or that they did not benefit from it in any way. Below, our Media property division lawyer outlines some tips that can help make the division of marital debt easier.
Dividing Credit Card Debt
Married couples often share certain types of debt. This is particularly true with credit cards. A very effective strategy for dividing this type of debt is for each spouse to agree to take responsibility for a certain percentage of the debt. Then, the spouses should obtain a separate credit card that is in their name only, making sure the card allows for balance transfers. The original debt should then be divided among the two new credit cards and ideally, the division should be as equal as possible. If one spouse is going to take on more of the debt, they should make a payment to their spouse to cover the difference.
Dividing credit card debt in this manner is often more effective than simply assigning a portion of debt to each spouse. This is because when one spouse is assigned a portion of debt, but the credit card is in the other spouse’s name, the person named on the card is still responsible for paying it. If the spouse assigned to it does not pay, then creditors can still legally go after the other party for the debt.
Dividing Vehicle Debt
Vehicles are considered assets but if they are not completely paid off, they are also a type of debt that will need to be divided. In ideal scenarios, the spouses may be able to reach an agreement about which party will keep the vehicle once the divorce is final. The spouse who keeps the vehicle should have the title transferred so it is in their name only. Refinancing the auto loan may also be necessary, as it can lower the payments and make it more affordable for the spouse keeping it to pay the debt.
Dividing the Family Home
Like vehicles, a home is considered both an asset and a debt if the mortgage is not completely paid off. In this instance, both parties should determine if they can keep the home. If neither party can afford to keep the home, it is usually easiest to sell the home and divide the profits among the two spouses, freeing both from the mortgage debt.
Our Property Division Lawyer in Media Can Help You Divide Your Debt
Dividing debt during divorce is never easy, but a Media property division lawyer can help. At Barbara Flum Stein & Associates, our experienced attorney can help with this division and give you the best chance of obtaining a fair settlement. Call us now at 610-565-6100 or contact us online to schedule a consultation and to learn more.