When you think about divorce, you might focus on dividing property and assets. But what happens to the debt you and your spouse built together? Dividing marital debt is just as important as splitting property, and it follows specific state laws that aim for fairness.
Understanding marital and separate debt
Ohio courts divide marital debt much like marital property. Marital debt includes any loans, credit card balances, or financial obligations you and your spouse took on during the marriage. Debt taken on before the marriage or after separation usually counts as separate debt. The key question the court asks is whether the debt benefited the marriage.
Factors courts consider in dividing debt
Ohio is an equitable distribution state, which means the court divides debt fairly, not necessarily equally. Judges look at several factors, including each spouse’s income, ability to pay, and who benefited from the debt. For example, if one spouse used a credit card to pay for household expenses, both may share responsibility. But if a spouse ran up debt on personal spending, the court may assign that debt only to them.
The role of marital assets and debt together
Courts often look at the full financial picture, weighing assets and debts together. If one spouse keeps a higher share of marital assets, they may also take on more debt to balance things out. The court aims for a division that leaves both people on more equal financial ground after the divorce. Transparency about all financial obligations is essential to avoid disputes or unfair outcomes.
Once the court divides debt, both spouses are legally bound to their assigned responsibilities. However, creditors don’t have to follow the divorce decree—they can still pursue either spouse if both names are on the account. Refinancing or paying off joint debts can help you protect your credit and start fresh after the divorce.