How Is Debt Divided in a Divorce?

Deciding who gets what is one of the hardest parts of a divorce. However, it isn’t just a problem when you’re trying to decide who gets to keep the car or new couch; you can also run into trouble dividing things that neither of you want, such as debt. So how is debt divided in a divorce under Virginia divorce law?

Equitable Distribution

During a divorce, the court will assign debt after considering a list of factors. Virginia is one of over forty states that has an “equitable distribution law” for dividing property and debts in a divorce. Marriage is considered to be an economic partnership as well as a legal and romantic one, and debt is divided much in the same way that property is. For a list of the factors, see Virginia Code Section 20-107.1.

Debt Classification

What does the process look like? First of all, debts will be classified as marital, separate, or part marital and part separate. Marital debt has been incurred by both parties (such as the mortgage on a home purchased together), while separate debt has been incurred by only one person (such as the balance on a credit card only held in one name and used for that party’s sole purposes). After classification, the debts will be valued to determine the exact amounts before they are divided.

Assigning Debt

Courts will assign debts based on many different factors, which can include:

  • The reason for the debts.
  • The property used for security on the debts.
  • The contributions of each person to the debts.
  • Tax consequences.

The judge can order the payment of debts incurred before the separation, but this won’t necessarily protect either party from creditors. Both spouses might still need to deal with third party creditors concerning debts created during the marriage. It is also important to note that an equitable (fair) division won’t always be an equal division. Debt and divorce in Virginia can both be complex topics, but knowing a little bit about the process beforehand can help.

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