What Happens to Your Debts If You Divorce?
Many divorced people complain about how their divorce ruined them financially, but the truth is that many of them were not in the best financial shape while they were married, or even before they met their spouse. These days, almost everyone is in debt, not just people with prodigal, work-averse, or materialistic ex-spouses. The current generation of engaged couples probably spends as much time daydreaming about paying off their student debts together as they do about travel or buying a house. In these bleak economic times, the grand prize is simply to break even. Just as divorce courts must make decisions about which assets belong only to one spouse and which ones must be divided, they also decide which debts are the responsibility of only one spouse and which ones remain an obligation on both spouses even after they divorce. If your debts are more enduring than your marriage, contact a South Florida divorce lawyer to find out how to get your assets and debts divided in a way that is fair to you.
Debts and Equitable Distribution in Florida
Florida’s equitable distribution guidelines contain provisions for dividing a couple’s debts as well as their assets. The law follows the general principle that property and income acquired during the marriage are marital property, which can be divided, whereas wealth that belonged to one spouse before the marriage remains with its original owner after the divorce. It applies a similar principle in classifying debts as marital or non-marital property. In other words, if you and your spouse both had student debt from your college education when you got married, then after your divorce, you continue to pay off your student loans while your ex-spouse continues to pay off theirs. Whether you used your income during the marriage to pay down each other’s debts is irrelevant; working together for the economic wellbeing of all family members is just a normal part of being married. The surest way to avoid being held responsible for debt your ex incurred before you got married, though, is to sign a prenuptial agreement.
Things get more complicated when you are married, but you borrow money in one spouse’s name only. For example, Matthew Wayne and Susan Einspar took out loans to help their young adult son. The student loans, which were in Matthew’s name, were more expensive than the car loan, which was in Susan’s. When they divorced, the court held each party responsible for the debts owed in his or her name. An appeals court later granted Matthew’s request to have the debts reclassified as marital property and divided accordingly, since they had borrowed the money as a family, even though only one spouse’s name appeared on the loan agreement.
Reach Out to Us Today for Help
Do not let your ex-spouse’s debts from before you met continue to burden you after you divorce, if you can avoid it. Contact a Boca Raton alimony attorney at Schwartz | White about your case.