When you and your partner decide to tie the knot, you’ll likely intertwine many aspects of your life, from sharing a last name and home to raising children. However, in the event that you decide to file for divorce, navigating these matters can prove incredibly complicated. One of the most common issues that couples face during a divorce is dividing joint debts in a way that is fair to both parties. As such, if you are unsure how the courts in New Jersey handle this process, you’ll want to keep reading. The following blog explores what you should know about these matters, including the importance of working with Morris County property division lawyers to help you navigate these difficult times.
What Debts Are Considered Joint?
Any time a debt is owed by two or more people, it is considered a joint debt. This means both parties are ultimately responsible for repaying the loan as per the terms and conditions of the agreement. If one party does not make a payment, it can reflect negatively on the borrowing history of both parties. Additionally, if one person defaults on the loan, the other party can be held liable for the outstanding funds.
Typical joint debts for married couples include vehicles, student loans, mortgages, credit card debts, and utilities. A debt can become a joint debt when both parties contribute to it, have their name on the account, or benefit from it in any way.
How Does the State Divide This Debt?
When a couple divorces, it’s important to understand that the state will divide not only the assets accumulated by each spouse, but also the debt incurred by the couple. As such, the state adheres to the equitable distribution method of dividing marital assets and debts. This means that the courts will prioritize dividing property fairly, rather than evenly.
When determining how to divide the debt between the couple, the courts will consider a number of factors. These include, but are by no means limited to:
- The income and earning capacity of each party
- Each spouse’s contribution to the marriage, both financially and domestically
- The reason behind the debt
- Who primarily contributed to the debt
- Who benefited from the debt
As such, the court will assign each party a portion of the debt that they will be responsible for paying. In some instances, the party that earns more may be assigned a larger portion simply because they have the ability to pay it. However, if only one party primarily benefited from the debt, the court will also take that into consideration, and could require that spouse to bear the burden of the debt they took out.
Navigating this process on your own can be incredibly overwhelming. That is why it’s in your best interest to connect with an experienced attorney with the Leslie Law Firm, LLC to help guide you through these difficult times. Contact us today to learn how we can fight for you.
