If you're filing for divorce, the property division process may be a key concern for you - specifically, how the court (or your and your soon-to-be-ex, if you can reach an agreement) will distribute liabilities. Today, we cover what you can expect from distributing liabilities during your NJ divorce.
At DeTommaso Family Law, we help clients through every part of the divorce process, including debt division. To schedule a consultation with our team, contact us online or via phone at (908) 274-3028.
Debt Division in NJ
New Jersey is an "equitable distribution" state, meaning that parties receive equitable - but not necessarily equal - portions of marital property, including liabilities such as debts. Marital property is commonly defined as property obtained post-marriage, with exceptions made for a select few items such as gifts or inheritances meant specifically for one party.
Many parties underestimate how many liabilities could be on the table during the debt division process. For example, it's possible that credit card debt - even if it's only under one party's name - could be divided among the parties. In situations where one party owns a business, it's also possible that any personal debts accrued from the business could also be distributed among the parties.
How Do Courts Decide Equitable Distribution?
The biggest factor in how much debt you take on from your divorce may be how the court calculates what would constitute an "equitable" distribution of debt. During property division, the court takes a wide range of factors into account, such as:
- The length of the marriage, as well as the age and health of both parties;
- The current economic status of both parties, as well as income or property they own separately;
- Whether any sort of marital agreement dictates who property should be divided;
- How a potential property division outcome would impact each part post-divorce;
- The tax ramifications of different property division arrangements;
- What current debts and other liabilities each party possesses;
- Whether the parties have children and, if so, the costs of raising those children;
- Any other factors the court considers relevant.
Because so many factors play into debt division cases, having an attorney you can trust at your side is vital. To schedule a consultation with one of our experienced property division lawyers, contact us online or via phone at (908) 274-3028.