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Family and Criminal Law Blog

Tuesday, October 19, 2021

Debt and Divorce

Divorce goes to the heart of so much of a person’s life. It goes to the family structure. Where you live. Who you live with. It can also deeply impact a person’s financial situation. This can be the result of many things. It can be the result of the expenses and costs associated with getting divorce. Going from a double income household with shared expenses to a single income household where just one person carries the full burden of household expenses can also be a significant new financial reality for a person. The way assets are divided in the divorce, additionally, can have big financial consequences. The way debt is handled during divorce can also be a big thing to consider.

Debt and Divorce

In a Texas divorce, marital assets and marital debt are subject to division. Debt will first be categorized as either marital or separate. Separate debt, which will mainly involve debt taken on prior to marriage, will remain the responsibility of the person who incurred it. Marital debt, on the other hand, will be subject to division. The parties can come to an agreement on the division of the marital debt or, in the absence of such an agreement, the court will divide the debt liability between the spouses.

It is important to be aware of the fact that creditors are not bound by the court’s final divorce decree. What this means is that, while the court may have assigned a certain debt for payment by a particular spouse, the other spouse will remain jointly liable for the debt. If the spouse who is supposed to pay a debt fails to make the requisite payments in a timely manner, the other spouse can be and will likely be pursued by creditors in order to see to it that those payments are made. Defaulting on debt obligations, regardless of whether your former spouse was supposed to make the payments pursuant to the divorce decree, will have its impacts on both spouses. Both spouses will see impacts on credit scores and risk things such as the ability to be approved for certain loans. Furthermore, both former spouses can be subject to collection efforts.

Because of the complications that can arise pursuant to the division of marital debt in a divorce, you may want to consider other options for paying off such debt prior to divorce. You and your spouse may want to sell off joint property and use the proceeds to pay off outstanding marital debt. Alternatively, your attorney can try to pursue a larger portion of marital assets in exchange for you taking on marital debt for payment. The reverse of this option would also work if your spouse would be willing to take on the marital debt in exchange for a larger share of marital assets.

Taking care of outstanding marital debt prior to divorce can be in the best interest of both spouses. If this is not a possibility, it is still important that you take steps to protect your credit score during divorce and after divorce. This involves monitoring your credit report and reporting any inaccuracies. It can also involve talking to a consumer counselor about your options for negotiating with creditors.

Family Law Attorneys

If divorce may be in your not so distant future, now is the time to talk to the team at Navarrete & Schwartz to discuss your options. We are proud to serve the residents of Midland, Texas. Contact us today.


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Navarrete & Schwartz, P.C. is located in Midland, Texas and serves the surrounding cities and counties, including: Odessa in Ector County, Andrews County, Martin County, Howard County, Winkler County and Crane County.



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