When couples think about dividing up their marital property, they usually focus on splitting the assets — no matter how small or extensive those may be.
Figuring out what to do with the marital debts, however, can be equally important. If you overlook this aspect of your divorce and you may find yourself facing financial complications long after your divorce is over.
What are marital debts and how do you divide them?
Generally speaking, marital debts are any debts you acquired after your marriage began. Debts that you brought in to the marriage are usually yours alone (although some bills may be commingled, or a mixture of premarital and postmarital debt).
Under Minnesota law, marital debt is divided equitably, rather than equally. This allows for a fair distribution of the debt based on each party’s contributions to the amount and their respective financial situations.
What then, is the problem? Well, your divorce decree can assign responsibility for a stack of credit cards to your spendaholic ex-spouse, but the banks that issue those cards aren’t particularly concerned with who is supposed to pay those bills. Should your ex fail to pay up, you could face collection efforts, damaged credit and other financial problems even years after your divorce is over.
What can you do to protect yourself?
The smart thing to do is to insist that you and your spouse eliminate any joint debts as part of your divorce agreement. For example, your spouse may be required to refinance their car loan without you as a co-signer or take a personal loan to pay off the credit cards that are in both of your names.
Eliminating your legal and financial ties to your spouse is part of the business of divorce. It’s always wisest to work with an experienced family law attorney from the very start.
