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How is Debt Split During a Divorce

Woman with calculator and bills

A divorce does so much more than just end your marriage, it also sets up your future. This is why it’s so important to have a lawyer on your side fighting for your rights.

One of the most highly contested matters in a divorce is the matter of debt, specifically who will be responsible for debts accrued before and during the marriage.

Dividing Debt in a North Carolina Divorce

North Carolina is an “equitable distribution” state. This means that debt (as well as other properties and assets) are generally divided in a way that would be equitable. It’s important to remember that “equitable” does not mean a perfect 50/50 split — debt can be modified in a way that’s fair for both parties.

Understanding Marital vs. Individual Debt

The primary sources of debt in the United States include credit cards, mortgages, car loans, medical care, and student loans. However, not all debts are equal under the law.

As their names imply, individual debt is often debt assumed by one person before the marriage, such as student loans or a car loan someone took out in college. Whereas marital debt is acquired by both parties after they were married. This would include things like a mortgage on the family home or credit card debts. In the event of a divorce, both parties are usually responsible for paying back marital debt.

Equitable Distribution

The law is rarely black and white, and every situation is unique. When determining how debt should be split, courts look at more than just what was purchased and when. They’ll also consider:

  • The assets and liabilities of each party.
  • Any obligation for support from a prior marriage.
  • How long the marriage lasted.
  • Direct or indirect contributions made by one spouse to help the career potential of another spouse.
  • Which spouse accrued the debt and for what purpose.

Take, for example, a husband who opens a joint credit card behind his wife’s back. If the purchases were made in secret and did not benefit the marriage, courts may consider this individual debt and require only the husband to pay it back, despite it being accrued during the marriage.

At Blood Law, PLLC, we believe in helping our clients achieve their goals – no matter how complex their divorce or other family law issue. Our experienced attorneys provide tailored legal services with a unique, team-based approach to do our best to achieve these results.

To learn more about our legal services, contact our lawyers online or give us a call at (704) 286-0570.