Credit card debt and other debts are handled a lot like property in a Michigan divorce.
Michigan residents are currently struggling with debt. From credit cards, mortgages, student loans and other loans, nearly everyone has a significant amount of debt. That being said, your divorce lawyer should be able to help you navigate and understand how your current amount of debt will be allocated in your divorce case.
What Debts Will I Be Solely Responsible For After Divorce?
Debts are handled in much the same way as property when you are getting divorced in Michigan. There are debts you accrued prior to getting married and debts you and your spouse took on as a couple. When it comes to separate debt, you will almost surely be responsible for taking care of debts you acquired prior to your marriage. For example, if you took out student loans prior to marrying your spouse, then you will most likely be responsible for them after your divorce.
However, there are also debts you and your spouse have taken on together, and these will be divided up by the court. The equitable distribution principle applies to debt as well as property. So much like your marital property, marital debt will be divided in the same way. The court will take into consideration the amount of debt, the income of both spouses, the expenses both spouses will have, and from there will split the debt “equitably” but not necessarily “equally.”
That means that if you and your spouse have a large credit card balance, the spouse that has a higher income may be responsible for a larger portion of the debt, even if one spouse is more responsible for creating it. However, a good divorce attorney can help you protect your financial wellbeing in this type of scenario.
Mortgage Debt and Divorce in Michigan
A mortgage is a unique type of debt, in that it is most likely taken out by both spouses, but depending on the judgment of divorce, may end up being the responsibility of only one spouse. This will often be determined by how the house is handled. If one spouse is going to keep the house, then the mortgage will need to be refinanced with only that spouse’s name on the loan. However, because the debt was acquired by both spouses, the spouse that does NOT live in the house may still be ordered to pay some of the debt via spousal support or alimony.
Additionally, some couples have more recently been “splitting” the home after divorce, with one spouse living in the home for some period of time in the year and the other spouse living in the home for the rest of the year. With a tough real estate market, this can be an effective compromise, especially when you have children. However, this is an uncommon way to deal with your house in divorce, and most would rather just have a clear-cut decision on which spouse gets the house or if they need to sell it. Your divorce attorney can help you fight for whatever outcome you prefer.
Financial Infidelity and Divorce
More recently, the term “financial infidelity” has been floating around. This refers to the practice of one spouse using money in a way that the other spouse wouldn’t approve of, without their knowledge. This may not necessarily involve romantic infidelity, but it is a form of dishonesty not suited for a marriage.
If you are using money in a way that your spouse wouldn’t agree to without their knowledge, and it comes to light, this might not only be a reason for them to file for divorce, but can also impact a court ruling. Because while Michigan is a “no-fault” divorce state, your conduct within your marriage still matters.
You should always disclose this type of behavior to your local divorce attorney as they can help you navigate the situation. Sometimes there are mitigating circumstances, such as having a spouse with unreasonable views on money or if you are in an abusive marriage and were saving money to get out.
Hire a Local Divorce Attorney to Help With Your Divorce
Divorces can be complex, especially when contested or when you have children. In order to protect your own rights and financial wellbeing, you need a divorce lawyer with expertise in these matters.