Did you know that all marital assets are separated during a divorce, even the debts? Debt is just like any other possession and has to be divvied up and redistributed during a divorce. Divorce is already a stressful time, but it becomes even more stressful when you add debt to the mix. Below is a breakdown of what happens to your debt during a divorce.
- Credit Card Debt- This type of debt may be from either a joint account or an individual account. Division of this type of debt involves multiple factors including whether the debt was incurred after the separation, the type of item purchased, which party is awarded the specific item purchased by credit card, and other factors.
- Mortgage- Usually, but not always, the court will want the children to remain in the home. However other factors and circumstances need to be taken into account. Is it financially feasible for the custodial parent to pay the mortgage? Are the children about to graduate to a new school soon? Could either party qualify to refinance the mortgage?
- Medical Expenses- Equitable division property states the court will take a variety of factors into consideration when determining the responsibility of medical debt. This includes whether or not you and your spouse were living together at the time the debt was acquired, whether you were legally separated at the time, whether the debt falls under the umbrella of necessary care, and what impact the debt might have on any children you have had. Of course, of primary importance is for which party was the medical treatment. And resulting expense, necessary.
Divorce is a stressful process, but knowing how it might affect your financial situation can help you reduce some of the stress. Take the time to sit down and look through all of your financial documents, bills, credit statements, loans, etc. Contact Dreyer Law today for a free consultation and to discuss the best set of actions to take when contemplating a divorce.