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What happens to debt during divorce division of marital property?

Anyone who has experienced divorce understands that property division is usually complicated. The process itself is simple if both parties are willing to cooperate when divvying up property and assets. However, that is not always the case. In contentious divorces, spouses find it difficult to divide marital property because they are afraid of getting less than what they deserve. It is also important for divorcing individuals to understand that when courts refer to property division, debt is also likely to be discussed.

In equitable states like Missouri, readers need to understand that marital property also includes marital debts, which will be divided. The higher earning spouse is likely to pay two-thirds of the debt while the other spouse will have responsibility for paying one-third. For example, if the divorcing party has personal loans, both parties will pay the debt as part of the divorce agreement.

It is important for a divorcing couple to determine all debts to ensure that they will be paid once the divorce is finalized. Additionally, spouses should note that some debts are considered separate and, therefore, the other party has no responsibility to pay those debts. If a spouse is a co-signee for a personal loan, it is highly likely that the debt will be divided equally.

Divorcing couples who had drafted prenuptial agreements before marriage may be spared from such dilemmas if the agreements contain instructions about how to divide debts in the event of divorce. It is important for spouses to review such agreements during or before they file divorce papers. Prenuptial agreements can help divorcing spouses settle property division, reducing divorce costs and other related expenses.

St. Charles readers who have more questions about property division may seek legal advice to ensure that they are on the right track.

Source: Findlaw.com, "Divorce property division FAQ," Accessed on Dec. 30, 2014

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