Understanding Divorce & Division of Marital Debt
In many respects, dividing debt during a divorce is as important as dividing marital assets. Additionally, if your spouse is contemplating filing for bankruptcy, you could be saddled with a large portion of marital debt after your spouse’s unsecured debt is wiped out or reorganized through Chapter 7 or Chapter 13.
It’s important to remember that you are legally liable for accounts and lines of credit with your name on them. Even if you never used a credit card or drove your spouse’s car, if your name is on the account or car loan, the creditor can initiate a collection action against you — regardless of whether or not your spouse agreed to settle the debt as part of your divorce settlement. At the Law Offices of Roger W. Stelk, we work closely with clients in regard to divorce and the division of debt, protecting our client’s financial and legal interests.
If you are facing divorce and are interested in learning how you can protect your credit and financial interests, contact debt division divorce attorney Roger W. Stelk today to schedule a free consultation.
Dividing Marital Debt – Protecting Your Credit and Financial Interests
Typically, the following kind of debt is subject to division:
- Debt on jointly held credit cards
- Debt on car loans
- Mortgage debt
- Debt in a jointly held company
Divorce Settlements and the Division of Debt
It’s important to remember that your divorce settlement has no legal effect on your contractual relationship with creditors. The fact that your divorce settlement indicates your ex-spouse is supposed to pay off the Discover credit card bill doesn’t prevent Discover from initiating collection actions against you if your ex-spouse defaults on payments. While you can seek an enforcement against your spouse if this happens, it’s better to negotiate a financial settlement up front as part of your divorce settlement.
For example, you may want to agree to pay off certain debts in exchange for other assets from your marriage. Here, you could agree to pay off the remaining balance of your ex-spouse’s car loan in exchange for him or her agreeing to relinquish claim to an amount of equal value on your 401k benefit or retirement plan. We can evaluate your situation and discuss the options available to you for protecting both your financial and legal interests.
Contact Divorce Attorney Roger W. Stelk Today
If you are contemplating divorce or have been served with divorce papers, it’s important to understand how your marital assets and debts will be divided. To schedule a free consultation and discuss your case, contact debt division divorce attorney Roger W. Stelk today (847) 506-7330.
