In addition to the emotional impact of divorce, ending your marriage can also negatively affect your financial well-being. Whether you have shared debt with your spouse or you have accumulated bills you cannot pay with the cost of establishing a separate household, careful planning can help you create a positive path forward.
These tips can guide you as you cope with debt during and after divorce.
Understand the terms of debt division
In Ohio, assets and debts either person acquires during the marriage represent community property. You and your spouse must divide these items fairly, but not necessarily equally. For example, one spouse may take on a larger share of an asset, such as a home, for a larger share of a debt, such as a mortgage. You can negotiate these items in your divorce agreement.
Settle joint accounts where possible
Negotiating a divorce will be easier if you pay off as many shared accounts as you can. Doing this before you begin to discuss property and debt divisions simplifies the process and supports a clean financial break from your spouse.
Review legal liability for debt
You can become legally responsible for debt your spouse accrues without your knowledge before divorce. If this occurs, you will need evidence that you were unaware of the debt. You should also remove your name from the accounts in question as soon as possible and file a report with the credit bureau in the case of fraud.
When you cannot afford to pay off your debts together or separately, you may want to consider filing for bankruptcy in Ohio. You may be eligible to discharge or reorganize your accounts for more affordable payments.
