A refresher on divorce and debt
People going through a divorce likely think about what they are going to receive in the final settlement: The family home, a portion of a retirement fund, child support and alimony. But what couple needs to remember is that there also is debt involved that must be addressed. Previous blog posts have looked into the issue, however, it’s so important that it’s worth revisiting.
Virginia is an equitable distribution state. That means the courts can divvy up the property and money of a couple based on a number of factors, including a spouse’s need or earning power. The courts have the authority to award an equitable distribution of marital property — and marital debts. Keep in mind, equal does not mean a 50-50 split. Rather, the court divides according to each party’s contribution to the accumulation of the property. That principle also applies to the division of marital debts.
Marital debts are liabilities you and your spouse acquired together, during the marriage. A student loan you took out in college, long before you married, is not a marital debt. It’s solely in your name and thus your ongoing responsibility. Debts in one person’s name are presumed marital unless proven to be separate.
For debts titled jointly in both you and your spouse’s names, each of you will be jointly responsible for payment of the debt. This means that if your spouse does not pay anything at all (despite being required to do so), the creditor can come after you for full satisfaction of the debt.
What can you do if your ex doesn’t pay his half — and you are worried about keeping your credit rating good? To protect yourself, you should consider having your attorney add an indemnity clause added to your divorce settlement. It could allow you to sue your ex-spouse for the money he or she didn’t pay, especially if you covered it yourself.
Make sure you are aware what you owe and what you can afford to pay off on your own. And include a clause that says you can take action if your spouse doesn’t follow through on his or her share of the debt.
The experienced family law attorneys at the DiPietro Family Law Group have decades of experience handling all types of family law matters and are here to help you.
Contact one of the DiPietro family law attorneys today to schedule a consultation with a caring professional at (703) 370 – 5555, or visit us online.
No Responses to “A refresher on divorce and debt”