Does The Length Of A Marriage Impact The Division Of Debt In A Divorce?

The length of a marriage impacts the division of debt only to the extent that there will be a greater proportion of marital debt as opposed to non-marital debt the longer a marriage lasts. It’s important to note that even if the debt is incurred only by one party during the marriage, it will generally be considered marital debt. However, there are some notable exceptions. For example, the court may consider student loans incurred during the course of the marriage to be solely the responsibility of the party who is obligated on those student loans, assuming that those student loans were actually used for the education of that party and not for family expenses. If the family lived on one party’s student loans during the marriage, then the court may very well consider that to be a joint marital debt. If, however, a doctor received hundreds of thousands of dollars’ worth of student loan debt in obtaining his medical license and he is now running a successful practice, then the court may well consider that student loan debt to be his alone.

What Happens If There Was An Agreement Between The Spouses To Share Responsibility Of Pre-Marital Debt?

It depends on the nature of the agreement, how it took place and when it took place. If it was part of a settlement agreement, then the parties can agree for one party to take the pre-marital debt of the other. The court may not award it without the party’s agreement, but if the parties agree, then that can create a basis for the court to enforce that agreement.

If, during the course of the marriage, the parties agreed to assist one another in their premarital debts and used their joint assets to pay off those debts, the court is unlikely to go back and untangle how much of the joint income was used to pay off premarital debts. In other words, if the parties comingled their assets and debts during the course of the marriage to the point that it’s no longer reasonably possible to distinguish pre-marital debt from marital debt, then the court will likely consider it to be marital debt.

How Does The Court’s Decision Impact The Viewpoint Of Creditors On The Debt?

If the debt was incurred solely by one party during the course of the marriage, the creditor may only pursue the party with whom they contracted, even if that debt was awarded to the other party. Thus, the party awarded the debt will generally be obligated to pay the debt even if it was originally incurred by the other party. In other words, if party A incurs a debt during the marriage in their sole name and that marital debt is awarded to party B by the court, party B must pay that debt and may be held liable for any damage done to party A if the creditor pursues party A for the debt. If the debt was incurred by both parties and is in both parties’ names, then the creditor may pursue either or both of the parties in an attempt to collect their debt.

What Can I Do To Ensure That I Am Not Held Responsible For My Spouse’s Debt Following A Court Decision?

A copy of the court order or decree can be provided to the creditor in hopes that the creditor will pursue the correct party. That said, the creditor may pursue you if you are obligated on the debt in the original contract. If the other party fails to pay the debt, then you may file an Order to Show Cause and have the other party held in contempt for their failure to pay the debt that they were ordered to pay. At that time, you may also ask the court to require that the other party refinance the debt within a reasonable time so that the creditor no longer has any interest in you, thus separating you from your ex-spouse’s debt.

How Is Tax Related Debt Handled In A Divorce?

The short answer is that most of the time it’s going to be handled in the same way as other types of debt, but there are exceptions. Those exceptions depend heavily on IRS code. The Law Office of Kelly Peterson assists divorcing parties in obtaining an equitable division of the debt and ensuring that that division is enforced. If you have questions or would like to set up a consultation, please give us a call at (801) 616-3301.

For more information on Length Of Marriage In A Divorce, an initial consultation is your next best step. Get the information and legal answers you are seeking by calling (801) 616-3301 today.

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*Child Welfare Law Specialist Nat’l Assoc. of Counsel for Children