Debt Management In Divorce

: Chris Lee Law Firm

  Filed under: Divorce

divorceMoney troubles are stressful for any couple, especially those that may be considering divorce. Left with the decision of who will take responsibility for certain debts and how assets will be divided can complicate things. There are a couple of things to consider about your debts before proceeding into divorce court.

Debt Division

In many cases, debts can be managed quite effectively in the divorce proceeding. Just as assets are listed for division, debt responsibility can also be outlined in the divorce papers. In such a case, you and your spouse would agree to divide debt liability as part of the final divorce decree. This generally means that each of you would walk away with a specific plan that outlines the responsibility over certain debts. Jointly held debts are typically divided in half, leaving each of you responsible for paying half of the remaining balance. Debts that were accumulated prior to marriage may be returned 100% to the original debtor. While this can be an effective way to divide debt responsibility, it can be tricky if the other party defaults. In such a case, you may be held responsible by creditors for full repayment of the debt.


Filing for bankruptcy after a divorce is not inherently difficult, except for when the debtor fails to inform the ex-spouse. Bankruptcy filing after a divorce can only guarantee asset and debt protection of the filer, often leaving the ex-spouse free to be pursued by creditors or even have their assets liquidated. Even if a divorce decree outlines the division of debts and assets, there is no legal protection against credit collections when the other party defaults. Although a divorce decree can offer some legal protection against undue collection efforts there are problems that arise in jointly held debts, in which both you and your ex-spouse are legally accountable for the debt. Filing for bankruptcy may protect the filer, but the other party may still be held liable. Secured debt assets, such as a house or car, could be seized and liquidated if the non-filing spouse does not resolve these debts after learning of the bankruptcy.

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