Division of Debts in Divorce
Like property acquired during a marriage, debts that a couple accrue also need to be divided upon divorce. Deciding who incurs which costs, offset by any property or assets distributed to each spouse, may sometimes result in disagreements and difficulties in reaching a settlement. The Nashville divorce lawyers at Martin Heller Potempa & Sheppard can help Tennessee residents determine which debts should be attributed to each spouse upon divorce. The goal is to try to agree on as many issues as possible, without jeopardizing the fairness of the process or the result. Our firm works with clients to evaluate their goals and expectations, striving to meet them as closely as possible.Factors Involved in Dividing Debts in a Divorce
Debt division works similarly to the distribution of assets when a couple is settling matters in a divorce. However, unlike with assets, there is no Tennessee statute defining what constitutes marital rather than separate debt. Courts have stepped in to define marital debt as “all debts accrued by either or both spouses during the course of marriage,” which are subject to being divided equitably between the spouses upon separation. Debts that an individual undertook before or after a marriage are generally not subject to division. Whenever possible, a court will distribute a debt to the spouse who also receives the asset associated with that debt, such as the mortgage on a property that will remain in that spouse’s control. Certain debt-asset ratios may become more complicated to divide, so a Tennessee court will determine their allocation by using four factors:
- The purpose of the debt;
- Which spouse incurred the debt;
- Which spouse benefits from the debt; and
- Which spouse has the better ability to pay the debt.
In situations in which a couple has accrued a joint debt, both parties are still liable. Even when one of the spouses agrees to absorb a debt, if they fail to pay, the other spouse may still be held accountable to pay the debt. Certain investigation and discovery methods may be important to determine which types of debt are at issue in a divorce proceeding. Consulting an experienced family law attorney who can aid in this process is important to make sure that any classification is completed carefully.Discuss Your Needs with an Experienced Divorce Lawyer in Nashville
Dividing debts is not an easy process, and it may become even more complicated when a couple has been together a long time, has complex holdings or substantial assets, or has markedly different abilities to pay off debts. The Nashville divorce attorneys at Martin Heller Potempa & Sheppard offer dedicated representation throughout negotiations and any necessary court proceedings related to property division. Our firm represents people across Davidson and Williamson Counties, including in East Nashville, Cool Springs, Bellevue, and Brentwood. You can contact us online or call us at 615-800-7096 to set up an appointment at which we can discuss how we may assist you. The guidance of a family law attorney is an important tool in protecting your interests during the marriage dissolution process.