Dividing Debt In A Divorce
In addition to dividing property, people often forget they have to divide marital debt. Dealing with the division of debts can be one of the most contentious issues. If you are getting divorced in Illinois, and you have any amount of debt, it is imperative that you know how to protect your rights. You should not be stuck paying an unfair share of your spouse’s debts.
At Taege Law Offices, our divorce attorneys in Chicago have extensive experience handling complex divorce and family law cases. If debt is an issue or concern in your Illinois divorce, you must take action to protect your legal rights and financial interests. Your credit could be negatively affected during the course of these proceedings and for years after your divorce if you do not take action.
To schedule a fully confidential divorce consultation, please contact our law firm today.
Debt Division And Divorce: Understanding Illinois Law
Similar to assets and real property, debts are divided in accordance with Illinois’ equitable distribution standard (750 ILCS 5/503).
Equitable distribution does not mean equal. Equitable means fair, which could result in one spouse being responsible for more than 50% of marital debt. Illinois divorce courts will consider the facts and circumstances surrounding the debt.
Some of the most important factors include:
- The future economic prospects of each partner
- The reason that the debt was incurred
- The date on which the debt was incurred
- The extent to which the marriage benefited (or did not benefit) from the debt
- Any other factors deemed relevant
How Our Chicago Divorce Attorneys Can Help
When you hire our Chicago divorce lawyers for guidance with your separation divorce, you can be confident that you will receive top-quality legal representation. We will carefully gather and review all of the financial records that are relevant to your case.
Our Chicago debt division attorneys can help you handle the full range of debts:
- Credit card debt
- Student loans
- Personal consumer debt
- Auto loans
- Payday loans
- Mortgages
- Home equity loans
- Business debt
When it comes to debts, you must be proactive. The truth is that creditors do not care about your divorce. If your name is still on a debt or loan, they will try to hold you responsible for repayment. But you can protect yourself by getting help from an experienced divorce attorney today.
Answers To Common Questions About Debt Division In Divorce
Who pays the marital debts in your Chicago divorce? Below, our family law debt division lawyers have answered some of the most common questions asked by prospective clients.
Can a prenuptial or postnuptial agreement affect how debt is divided in a divorce?
Yes, it can. If one party comes into the marriage with a lot of debt or will soon incur significant debt in the future, a prenuptial or postnuptial agreement can be used to assign sole responsibility for the debt to the party that accrued it. For instance, if you owned a business before marriage and were worried about saddling your soon-to-be spouse with business debts, you could assume all of those debts in a prenuptial agreement.
Can creditors still come after me for debt assigned to my ex-spouse in the divorce?
It depends on how and whether the debt obligations were redistributed, but the answer is often yes. If your name was on the original loan paperwork or other agreement, you likely remain a liable party even if the debt was assigned to your spouse in the divorce.
There may be certain actions you can take to prevent your own liability, such as having your ex-spouse refinance a loan and taking your name off it. Such actions are not possible in all cases, however. It is important to speak with your Chicago debt division lawyer about any options and protections you may have.
What should I do if my ex-spouse stops making payments on debt assigned to them?
You have several options, depending on the details of the debt and how it was allocated in the divorce settlement. Perhaps the most direct course of action would be to contact your own attorney and file a motion to hold your spouse in contempt of a court order. If granted, a judge might compel your spouse to make payments or reimburse you for payments you need to make to avoid damaging your credit.
All court actions take time, so do not wait to take action if you suspect that your ex-spouse will ultimately refuse or fail to resolve the issue on their own.
Can I negotiate the terms of debt division with my spouse before going to court?
You can, but it will need to be formalized in the proposed divorce settlement and approved by a judge. Generally speaking, it is a good idea to resolve joint debts before going through the divorce process, but this is obviously not possible in all (or even most) cases.
Contact Our Chicago Family And Divorce Attorneys Today
At Taege Law Offices, our Illinois divorce lawyers have extensive experience handling complex cases involving debt division and property division.
To get immediate help with your Chicago divorce, please contact our legal team today by calling 312-667-7706. We are proud to serve family law clients throughout the greater Chicago area.