June 28, 2012

Dividing Debt in Divorce

Divorce and dividing debt

Article By: William Dorsey
Contact Us With Your Divorce Law Questions.

One of the most common fears of couples in divorce revolves around money.  It is entirely reasonable for divorcing spouses to worry if they will be able to survive financially after the split.  For one thing, many residents are terrified by the thought that they might find themselves paying their mortgage and marital debts alone.

However, following some simple measures provided by the law can ensure fairness in not only property allocation but also debt division.

The Basics
Marriage is like any other legally enforced agreement whose purpose is to create a union between two people. It results in a change of their status into husband and wife, giving rise to new rights and obligations to both spouses. The union is terminated by a demand for divorce, where the assets and liabilities are to be divided between the parties.

The law in Florida distinguishes marital assets and liabilities from non-marital assets and liabilities. When two people are married there is a presumption that all their property and debt are common. Marital liabilities are those incurred during the marriage, individually by either spouse or jointly by them.  This presumption still applies in a proceeding for dissolution of marriage, where the court begins with the premise that all marital liabilities will be equitably divided between spouses.

Exceptions to Splitting Everything Equally
However, some categories of liabilities will escape this presumption, making each spouse individually responsible for non-marital debts incurred either prior to or during the marriage.

Also one spouse can also reverse the presumption of equitable distribution of debt by bringing evidence of the intentional waste or destruction of marital assets by the other spouse, unequal economic circumstances, or other reasons to be evaluated by the court.

1. Exclusion of one spouse’s individual debt from the division
In divorce, the court will not only set apart to each spouse that spouse’s non-marital assets but also certain liabilities—that is, one spouse will not be held accountable for the debts of the other. Individual debt that will not be considered in the division include:

· Any liabilities incurred by one spouse prior to the marriage (e.g., educational loan or business loans)
· Any liabilities excluded from marital assets by valid written agreement of the parties (prenuptial agreements)

2. Unequal distribution of debt determined by the court based on certain factors.
Upon dissolution of the marriage, the court may also effectuate an unequal distribution of marital liabilities based on relevant factors of contribution to the marriage by each spouse including:

· The economic circumstances of the spouses
· The duration of the marriage
· Any interruption of personal careers or educational opportunities of either spouse
· The contribution of one spouse to the personal career or educational opportunity of the other spouse
· The desirability of retaining the marital home as a residence for any dependent child of the marriage when it is equitable to do so and is in the best interest of the child
· The intentional “dissipation, waste, depletion, or destruction” of marital assets by one spouse after the filing of the petition for divorce or within 2 years prior to the filing of the petition

Legal Help
It is easy to get overwhelmed when learning about how the law applies in these situations.  That is why it is vital to get legal help as soon as possible.  In our area a Jacksonville divorce attorney can break down how these rules might apply in your case and advocate aggressive on your behalf to ensure your interests are protected every step of the way.

Contact Us Today for Your Divorce Consultation.

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