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Debt and divorce -- it's complicated

Debt is tough. Paying off balances for auto loans and credit cards might already feel like a Herculean task, but things can get a lot more complicated during a divorce. When couples accumulate debt during a marriage, it can be considered marital property to be divided between the two.

Say a couple has a credit card balance, student loan, and auto loan that were all accrued during the marriage. Like many married couples, they may have chosen to take out this debt jointly. During a divorce, this joint debt will be divided equitably -- not necessarily equally -- between the two, with each spouse being responsible for paying his or her share of the debt. However, problems can arise when one person falls behind on payments, because creditors can still come after his or her ex-spouse for payment.

But what happens when one spouse took out a credit card in his or her name alone, while another borrowed money to purchase a vehicle individually? This is where things can get tricky. If that credit card was used for marital expenses and the vehicle was a family vehicle, a judge could decide that both spouses are responsible for paying these debts. A judge could also decide that a spouse with a much higher income has to repay all or most of the joint debt -- even if it was not taken out in his or her name.

It is true that divorce may impact someone's financial situation, so the goal is often to minimize as many of those effects as possible. This often means securing alimony or child support on one hand, or ensuring that the amount is appropriate for the person who is paying on the other hand. It also means dividing debt in a way that is most appropriate for the specific situation, and having a knowledgeable advocate on one's side can be helpful when doing so.

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