Sharing a married life with someone will most likely lead to making many financial decisions together. If you find yourself going through a divorce, you may focus on dividing up the combined assets, but you also need to sort out the debt. You can’t assume that your divorce will split loans up the way you expected, so you need to take steps to protect yourself from financial troubles in the future.
Massachusetts courts treat debts as “negative” assets to be divided in a divorce. The courts consider the same factors in allocating debts as it does in allocating other assets. Therefore, any liability that is secured by an asset is likely to become the responsibility of the person receiving the property.
Protect Your Financial Future
You should make moves to protect your credit in the long run. Even if you’re splitting amicably with your spouse, it’s best to clear yourself of financial situations which may be left in the hands of collectors.
- Remove yourself from loans – Ideally, you want to separate yourself from any shared loans that your ex is supposed to repay. However, most lenders may not simply take your name off a shared loan after divorce. Initially the loan was approved based on both of your incomes and credit histories, so the lender may need to review the remaining borrower’s credit and income before removing the other name.
- Liquidate assets – Sometimes the best option is to sell any items on which money is still owed, split the proceeds and part ways. You won’t always get the desired value, and may be even need to sell your assets for less due to market timing or depreciation. Sometimes this is the only option to clean your hands of it and move on, knowing that the future of your credit is in your own control.
These are only a couple of options. These and other possibilities should be considered and discussed with your attorney.
Contact An Experienced Family Law Attorney
Whether you’re going through a divorce in Buzzard’s Bay or anywhere else in Southeastern Massachusetts and Cape Cod, you’ll need a divorce lawyer with experience and a winning record. Please contact us to discuss your case.
Photo Credit: bacho12345 / 123RF Stock Photo