When divorce seems to be imminent in your relationship, you are well-advised to being preparing for the process. Preparation can obviously take many forms, but among the most important decisions to be made will almost always be financial considerations. At some point along the way, you and your spouse will need to determine how your property and assets will be divided, or, if you cannot reach an agreement, the court will make the decision for you. Marital debt, however, is an important factor as well, as you and your spouse must also decide how your obligations will be handled in your divorce.
In many ways, dividing marital debt is much more complicated than dividing assets. While deciding who gets what property may be difficult, once the process is complete, each spouse assumes ownership of the asset and life moves forward. With debt, however, there are often repayment contracts, promissory notes, and other instruments of debt that convey potential penalties for failure to comply. Therefore, in order to divide the debt between divorcing spouses, these contracts will generally need to be reworked or refinanced to account for the change in responsibility. Failure to do so could, for example, result in a credit card company pursuing legal action against an ex-wife whose name is still on the account when the ex-husband fails to make payments as ordered in the divorce judgment.
Consider Eliminating Debt
Although it may not be possible in every situation, you may want to give some thought to paying down as much of your debt as you can before you start the divorce process. This could mean liquidating other assets, such as retirement savings or investment properties, to reduce your financial obligations. If you are able to work cooperatively with your soon-to-be ex-spouse, develop a reasonable approach to paying off your debts so that both of you will have the resources you need for a reasonable post-divorce life. By doing so, you may have less property to divide between you, but you may be able to being your new life without being encumbered by debts incurred during your marriage.
Work Closely With a Lawyer
While it is certainly advisable to discuss the possibility of paying off marital debts with your spouse, a qualified lawyer can help you identify potential legal concerns and dangers. For more information about the impact that debt can have on divorce, contact an experienced Orland Park family law attorney. We offer a free, confidential consultation so that you can get the answers you need and the quality legal counsel you deserve. Call 708-518-8200 to schedule an appointment today.