When a couple divorces, one of the most important things to figure out is how to split the debt. This can be a complicated process, especially if there is a lot of debt accumulated during the marriage.
In this article, we will discuss how debt is typically divided in a divorce and some of the factors that may come into play. If you are going through a divorce and need help sorting out the finances, it’s best to seek help from any of the top family lawyers Sydney.
How Debt Is Divided in a Divorce
In most cases, the debt accumulated during a marriage is divided equally between the spouses. This includes both joint and individual debts. However, there are some exceptions to this rule.
For example, if one spouse took out a loan without the other’s consent or if one spouse was responsible for most of the debt due to lavish spending, that spouse may be held liable for more of the debt.
There are also a few things that creditors can do to help ensure that they get paid back in full. For instance, they may seek a judgment against both spouses or try to garnish their wages. Again, if you are concerned about how your divorce will affect your debt, please contact a reputable family lawyer today.
Factors That May Affect Who Pays the Debt in a Divorce
There are many factors that may affect who pays the debt in a divorce. For example, if one spouse has more assets than the other and they will get custody of the children from previous relationships, they may end up paying less of the marital debts.
This can be done through alimony payments or other means, such as property division orders and child support orders granted by the court during divorce proceedings (and sometimes even after). However, this isn’t always the case.
Some couples choose to share their income equally between them, splitting it into separate accounts at any point thereafter without consulting an attorney about potential tax implications due to specific circumstances surrounding each individual situation (thus resulting in one party having more assets depending on when this split occurs during proceedings—such as if they decide post-divorce after all kids are grown up or before marriage itself).
In addition to these factors, the amount of debt that a spouse is responsible for may also be affected by their income and credit score. For example, if one spouse makes less money than the other or has poor credit history (or both), they will likely have lower payments due each month and therefore owe less overall at any given time during the divorce proceedings—which could lead towards an agreed upon settlement much faster and with better terms.
If you are considering a divorce and have questions about how debt will be divided, reaching out to a family lawyer is truly paramount. They can help you understand your rights and responsibilities and will expertly negotiate on your behalf.