Debt resolution


#1

If you have a separation agreement for equitable distribution then you and the STBX can work out whatever arrangement works best for you both.
If it’s a court ordered equitable distribution, it will likely depend on the nature of the debt. If you agree to take on a credit debt alone that was incurred while you were married then you would pay it to the creditors as you normally would until the debt is paid. If a debt is divided and you owe a portion of it it would probably depend on the amount of your portion as to whether it is made in installments or paid in full.
All marital debt and assets are divided equally between spouses providing that both spouses have finacial means to pay the debt.


#2

It does not have to be paid in full. It is generally assigned to one spouse or the other for payment. If a debt is in both names and one spouse fails to pay, that does not mean that a creditor will not pursue both spouses. However, the spouse who was not ordered to pay the debt can take the other spouse back to court if they fail to pay.

Helena M. Nevicosi
Attorney with Rosen Law Firm

4101 Lake Boone Trail, Suite 500
Raleigh, North Carolina 27607
919.787.6668 main phone
919.256.1665 direct fax

10925 David Taylor Drive, Suite 100
Charlotte, North Carolina 28262
704.644.2831 main voice
704.307.4595 main fax

1829 East Franklin Street, Bldg 600
Chapel Hill, NC 27514
919.321.0780 main phone
919.787.6668 main fax

ROSEN.COM

The response posted above is based upon the limited factual information made available and is not intended as a full and complete response to the question. The only reliable manner to obtain complete and adequate legal advice is to consult with an attorney, fully explain your situation, and allow the attorney sufficient opportunity to research the applicable law and facts required to render an accurate opinion. The basic information provided above is intended as a public service but a full discussion with an attorney should be undertaken before taking any action.


#3

If, for instance, the debt is a joint credit card, my understanding is that I would not be responsible for anything my spouse purchased after the separation. Would she need to provide statements indicating what had been purchased?

Also, I was told that a formal separation agreement was not required - is this true? How would this affect determining what portion of the debt I would be responsible for?


#4

Based on the laws of Equitable Distribution in NC, you would not be responsible for debt incurred by your spouse after the date of separation. However, if the debt is incurred on a joint credit card, that will not stop the creditor from pursuing you. If you and your Husband do not have a written agreement regarding what to do with the debt and he does not follow through after the divorce if final, you would have no way to force him to pay the debt.

If you have a joint card and an agreement that requires him to pay, you can sue him to enforce the agreement. This will not stop the creditor’s from taking adverse action on your credit.

The moral of the story is, if you can avoid it at all, don’t have joint debt after you are divorced and make sure you put your agreement in an enforceable contract.

Helena M. Nevicosi
Attorney with Rosen Law Firm

4101 Lake Boone Trail, Suite 500
Raleigh, North Carolina 27607
919.787.6668 main phone
919.787.6361 main fax

301 McCullough Drive
Suite 510
Charlotte, NC 28262
Main Voice: 704.307.4600
Main Fax: 704.943.0044

1829 East Franklin Street, Bldg 600
Chapel Hill, NC 27514
919.321.0780 main phone
919.787.6668 main fax

ROSEN.COM

The response posted above is based upon the limited factual information made available and is not intended as a full and complete response to the question. The only reliable manner to obtain complete and adequate legal advice is to consult with an attorney, fully explain your situation, and allow the attorney sufficient opportunity to research the applicable law and facts required to render an accurate opinion. The basic information provided above is intended as a public service but a full discussion with an attorney should be undertaken before taking any action.


#5

When the debt is divided, does it have to be paid in full? Or can the responsibility for a debt be assigned to one spouse to continue payments?