When going through a divorce, each spouse normally spends a good amount of time worrying about how assets are going to be divided. Is the ex-husband going to keep the home? Is the wife going to try and take the family van? Just how are the bank accounts going to be split up?
Of course these are all legitimate concerns. But, when it comes to dividing up all that was accrued during a marriage, make sure to also think of the debts.
Just how these debts are going to be divided depends on how the state recognizes marital property. For example, Missouri is an equitable distribution state, which means it is ultimately up to a judge to make a fair decision on how to split up all assets and debts of a marriage. For some this could mean a 50/50 split. But for other couples equitable division does not necessarily mean dividing everything up straight down the middle.
Since the recession, there has been a shift in focusing on asset division to debt division in divorce. This shift in concerns happened while the net worth of the average American family also sharply declined. From 2007 the average net worth was $126,400. In 2010 the average family new worth was $77,300. This represents a 38 percent decrease.
When it comes to just when debt becomes a concern, some note it’s normally when there are mortgage loans, student loans and credit card debt reaching more than $15,000.
As one can imagine, debt division in an equitable distribution state such as Missouri can become quite complicated and complex as each spouse tries to justify why debts need to be divided in a certain way. To learn more about our firm, please visit our St. Louis marital property and debt page.
Source: The Augusta Chronicle, “Debt often focus of divorce proceedings,” Kyle Martin, Sept. 23, 2012