How Are Debts Divided in a Florida Divorce?

One often overlooked aspect in a divorce is debt division. But debt division can be just as confusing and contentious as the division of property. Keeping in mind that financial difficulties are a leading cause of divorce, the truth is that many divorcing couples have to face the reality of dividing a significant amount of debt. So, if you are about to get a Florida divorce, you must understand what the law says about how debts are categorized and divided.

Marital vs. Separate Debts

Determining if the debt is marital or separate is the first step of dividing debt in a Florida divorce. Marital debt is any debt that either spouse incurred during the marriage. This is true regardless of which spouse’s name is on the account. On the other hand, non-marital debt is any debt that one spouse came with into the marriage or acquired alone after separation. In Florida, only marital debts are divided between spouses during a divorce. Spouses are individually responsible for any separate debts.

Types of Marital Debts

Married couples often have different kinds of debts, including the following;

• Credit card debt
• Auto loans
• Mortgages
• Student loans
• Home equity lines of credit
• Medical debt

Some people assume that marital debts are accounts in both spouses’ names, but it is rarely that black and white. The above debts can be considered marital if they were incurred during the marriage, even if only one spouse’s name is on the account.

How Do Florida Courts Divide Debts During Divorce?

Just like it is with assets, the principle of equitable distribution is applied to the division of debts in Florida. This principle aims to ensure a fair division, but not necessarily an equal one. While the court begins with the presumption that a 50/50 split is fair, that can change depending on various factors, including;

• Each spouse’s financial situation
• The nature of the marriage, such as the length and whether one spouse had to quit their career to take care of their children
• The circumstances surrounding the debts
• The intentional wastage of marital assets

For example, if one spouse has significantly more financial resources than the other, the court may assign them a larger portion of the marital debts. Similarly, if one spouse incurred debt as a result of an extramarital affair or gambling, the court may assign that debt to the responsible party.

Joint Debts Can Cause Complications

Even after a divorce agreement outlines debt responsibility, creditors are not bound by the agreement. This means that if the spouse responsible for making payments fails to do so, creditors can pursue the other spouse for payment. This situation can occur with student loan debt, mortgages, and credit card debts that are held jointly. In order to avoid surprises, it may be wise to close joint accounts, refinance loans if feasible, and communicate with creditors. It is also a wise idea to consult an attorney. An attorney can help you structure a settlement that clearly assigns responsibility.

Contact an Orlando Divorce Lawyer

If you are facing a divorce, our skilled Orlando divorce lawyers at the Arwani Law Firm can help you settle marital debt matters. Contact us today to schedule a consultation.

Source:

flsenate.gov/Laws/Statutes/2023/Chapter61/Part_I