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What happens with shared debt during a divorce?

When dissolving a marriage, one may be thinking about custody arrangements for the kids or how assets are to be divided. Many fail to consider any debts they may have, especially those debts that are considered shared marital property. In Maryland, debts, just like positive assets, may be divided between spouses in the final divorce settlement.

Most married couples have shared debts; it simply is the norm. They come in the form of credit cards, mortgages, auto loans and other loans. Any debts that cannot be paid off before a divorce is finalized are subject to division. This can be a good thing, as there can be clear instructions given as to who is responsible for what. However, this is also a bad thing, as what is written in a divorce settlement does not mean anything to creditors.

At the end of the day, if one's name is on a joint account, he or she can still be held responsible for making payments. So, for example, years after a divorce, if one's ex fails to make payments on a shared credit card, creditors can then pursue payment from anyone whose name is on the account. Not only can this be a problem for the individual who was not assigned the debt in the divorce, but it can damage his or her personal credit rating and finances.

When getting a divorce in Maryland or elsewhere, with the help of legal counsel and financial advisors, one can take the steps necessary to protect his or her post-divorce credit situation. Not only can settlements in which debts are fairly divided be achieved, but further actions to address how joint accounts are to be handled can be taken. These may include setting time lines for closing joint accounts or specifying the use of any available assets to pay off shared debts -- among others.

Source:, "Manage Your Debt for a Smoother Divorce", Shawn Leamon, Dec. 7, 2016

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