How to Manage Your Debt in an Illinois Divorce

 Posted on October 14,2020 in Divorce Finances

Illinois couples who are considering a separation or divorce should also begin the process of evaluating their debts. When couples elect to divorce in Illinois, the partners are required to divide both their debts and assets. If the matter of debt and asset distribution is left up to the court, the state’s equitable distribution guidelines will be utilized. In most cases, these rules are not conducive to the wide variety of financial situations couples may be contending with. Also, it is important to understand that the state’s equitable distribution guidelines do not mean that all debts and assets will be divided equally. Instead, they will be divided in a manner that the court deems to be fair and just based on the circumstances.

Prenuptial Agreements Often Fail to Address Marital Debt

In many cases, even if the couple had executed a prenuptial agreement that outlines the distribution of separate and marital assets, the issue of debt accumulated during the marriage is not included in the agreement. Many couples find that the best solution to amicably resolve the issue of debt accumulated during marriage is to work together to pay it off before beginning the divorce process. If this is not possible, each partner must be proactive about making sure that they do not take on more than their fair share of the total debt load.  

Consumer Debt From the Marriage

Consumer debt such as credit cards can become a particularly contentious issue in a divorce. It is important to understand that, with regard to joint accounts, the credit card company is under no obligation to recognize your divorce agreement. This means that no matter how you and your partner divide the debt, both of you may still be liable if the other defaults on their payments, just as if you were still married.

Debt Management During Divorce

As long as you remain married, any debt accumulated is the responsibility of both partners. To minimize your risk of becoming responsible for debts incurred by your partner while in the process of divorce, take the following measures:

• Document household expenditures and maintain a ledger of household expenses and purchases made for the family’s use.

• Open an individual bank account and close all joint bank accounts and joint credit card accounts.

Contact a Wheaton Divorce Attorney

If you are considering a separation or divorce, it is important to speak with an experienced DuPage County asset and debt division lawyer so that you fully understand all of your options. Contact Andrew Cores Family Law Group by calling 630-871-1002 and schedule your free consultation today.

Source:

https://www.ilga.gov/legislation/ilcs/ilcs5.asp?ActID=2086&ChapterID=59