As part of the uncoupling process, divorce requires the distribution of assets as well as debts. Married couples may accumulate a lot of property while they are together and they might also amass some debts as well. Couples need to work together to try to divide their marital property in a fair and equitable manner. An experienced divorce attorney will guide you through the process to ensure that you obtain the correct settlement.
Understanding Marital Property
Wisconsin is one of the states that follow the community property rule for divorce. Community property, also called marital property in Wisconsin, is anything that a couple earns or purchases and any debts they accumulate during the marriage. Any property you bought, items you obtained, wages you earned, or any other assets you accumulated after the date of your wedding is marital property. Marital property belongs equally to both parties, regardless of which person actually made the initial purchase. Debts also belong to both spouses equally.
Marital Debt
There are many types of debt that a couple may acquire during their marriage. Some common types of debt include credit cards, personal loans, mortgages, home loans, car notes, and more. Marital debt includes purchases both or either party made during the marriage. One of the first steps in dividing property in a divorce settlement is to determine what is marital property and what is separate property. Generally, separate property is property that you had prior to marriage. It also includes gifts that were given to you alone as well as inheritances that you received.
Dividing Shared Debt in Divorce
Division of debt can be somewhat complex because couples may have come into the marriage with their own personal debt. In some cases, debt you had before marriage may be considered marital debt, depending on the circumstances. Other complications occur in situations where one party owned a home and had a mortgage prior to marriage. It is helpful to make a list of debts owed at the time of separation so you can properly calculate and divide the debt owed by each spouse.
Who is Responsible for Debt After Divorce?
Debt doesn’t go away during a divorce. Instead, each party will need to know which specific debts they will be responsible for repaying, even after divorce. If one person’s name is on a loan, that person is ultimately liable for the debt, even if the divorce decree says you are both responsible. In this situation, the creditor could come back to you for repayment, even if the court determined that you should both be accountable. Therefore, you will want to thoroughly understand your obligations and make the proper arrangements in your divorce order.
Debt distribution can be complicated in divorce, especially if you owe a lot of money. A qualified divorce attorney will help evaluate your assets and debts and assist you in seeking a fair settlement. To learn more, contact us today at Moen Sheehan Meyer, Ltd. at (608) 784-8310 or online to schedule a consultation.