The divorce process may be complex but for many, it is a worthwhile solution to living a happy life. Working with your soon-to-be ex-spouse through the process presents many challenges, but with the help of an experienced divorce attorney you will come out on the other side much better than before. One of the more common issues facing those going through a divorce is who has to pay which debts? For this reason, it is vital to speak with an experienced family law attorney to discuss your case. Contact Nitti & Nitti Attorneys at Law today to schedule a free consultation into your divorce.
Community Debt vs. Separate Debt in New Jersey Divorce
In divorce, it is likely that you will not be responsible for the separate debt or debt that is not in your own name. However, community debt is something that will impact both you and your ex-spouse. This type of debt is one that is created by either or both spouses while they are married. For example, a joint credit card can end up being community debt regardless of whose name is on the account. This means both you and your ex-spouse will be responsible for that credit card debt.
It is important to note that even though the divorce court may declare which community debts each of you are responsible for, they hold hot water over your creditors. Therefore, a creditor can demand you or your spouse pay the bill if the other fails to do so. If you end up paying for such a community debt, you do have the ability to ask for reimbursement from the divorce court or ask for a judgment against your non-paying spouse and have their wages garnished. You should also be aware that this sometimes leads to the non-paying spouse filing for bankruptcy, leaving you with little options other than to also file for bankruptcy.
Other examples of community debt to be cautious of include the following:
- Mortgage debt – Typically, your home mortgage will be in both of your names. The best option, in this case, is to sell the home and split the money because it allows for a clean break. In the event one of you wants to keep the property, you can request the other party’s name be removed from the loan agreement. If the mortgage company declines, you can always refinance without the other person’s name on it.
- Medical debt – The court will look into if you and your spouse were living together or legally separated when you acquired medical debt and how the debt might impact any children you have.
- Auto loan debt – The best way to handle an auto loan with both names on it is to refinance without your spouse. If one person stops paying, you and your spouse’s credit will both be negatively impacted. You might have to trade in your vehicle for something more manageable and within your new budget.
At the end of the day, it is advisable to pay off your debt prior to finalizing your divorce. Of course, this isn’t always plausible for every divorcing couple. When things get complex and difficult, utilizing an experienced divorce attorney can definitely help.
Contact a Roseland Family Law Attorney for a Consultation About Divorce Debts in New Jersey Today
If you are thinking about filing for divorce, or if you have already started the divorce process and are dealing with another matter such as child custody, child support, or division of assets, you need to speak with a qualified attorney. The New Jersey family law attorneys at Nitti & Nitti Attorneys at Law represent clients throughout the state, including Irvington, Bloomfield, West Orange, Montclair, Belleville, Orange, Livingston, and Nutley. We understand how challenging this time can be for you, which is why we will fight hard to protect your interests, and the interests of your loved ones, throughout the legal process.
The articles on this blog are for informative purposes only and are no substitute for legal advice or an attorney-client relationship. If you are seeking legal advice, please contact our law firm directly.
