Divorce can bring about many uncertainties, even if it has been on the table between you and your spouse for quite some time. One of those uncertainties might be the outcome of any outstanding debts you have when the divorce is final.
Tennessee divorce law outlines a policy of equitable distribution of marital assets, including debts. Understanding more about the asset division process and how it affects debts can help you proceed through your divorce with greater preparedness.
Are all debts split evenly in a divorce?
All shared debts in a marriage are subject to equitable distribution. This means that each spouse receives an equivalent share of marital debt unless an agreement is in place which mandates that one spouse receives less debt in exchange for a greater share of other assets. Individual debts, such as credit card debt under only one spouse’s name, may not be subject to asset division during divorce.
What steps should you take regarding debts before a divorce?
Outstanding debts can make the asset division process more lengthy or burdensome during a divorce. Additionally, each spouse is individually responsible for their share of the debt afterward, which can be difficult to manage when transitioning to a single-income lifestyle. It may worthwhile to cooperate with your soon-to-be ex-spouse to reduce outstanding debts before moving forward with the divorce.
Asset division can be a contentious aspect of any divorce, particularly when a life-altering amount of debt is in the mix. It is important to work closely with your legal team to secure the best outcome and to mediate amicably with the other party whenever possible.