Attorney Katherine Kraus

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in Peoria!!!

3 times to challenge debt-related liability when divorcing

On Behalf of | May 29, 2024 | Divorce

Married couples typically have to find an agreeable way to share their financial obligations and their assets with each other. For some couples, handling high-value property because a sticking point during divorce proceedings. For others, it could be responsibility for debts that triggers the most conflict. People sometimes resent the idea that they may become responsible for debts taken on by their spouses during the marriage.

In theory, most couples have to accept shared responsibility for financial obligations that originate during the marriage just like they have to share their income and assets acquired during the marriage. However, there are a few scenarios in which it might be appropriate to ask the courts to exclude certain debts from the marital estate.

When the debt is from before the marriage or after separation

The timing of debt acquisition is an important consideration when addressing marital property. Most of the time, debts owed prior to the marriage are the separate responsibility of the person who took on those debts. People may have to go over their financial records very carefully to validate if the debt is part of the marital estate or not.

When the debt was hidden by one spouse

Some people engage in financial infidelity. They lie about their finances to their spouse. If someone feels embarrassed about their spending habits, for example, they might open a credit card without telling their spouse about it. They may then try to include those debts in the marital state when they divorce. If someone intentionally hid their financial circumstances from their spouse, their secret credit card might not be part of the marital estate.

When the debt is due to dissipation

There are many ways that people can intentionally waste marital resources. Dissipation or the intentional destruction of marital assets can directly influence how the courts divide both assets and financial obligations. If someone can prove that their spouse spent thousands on credit cards in a manner that was not consistent with their usual habits prior to divorce, the courts might exclude those obligations from the marital estate. If there are credit card debts related to an extramarital affair, people can also potentially ask the courts to make the unfaithful spouse solely responsible for those debts in particular.

Going over financial records carefully with the assistance of a skilled legal team can help people to potentially identify debts that potentially do not belong in the marital estate prior to property division negotiations. Those who understand the rules that apply to property division can fight for a fair outcome during divorce.

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