Debt and Divorce – What you need to know about Equitable Division (part 1)

How does the court divide your debt during a Michigan divorce?


When people get divorced, their first thoughts, when it comes to finances,are often about their assets. However, while it’s often overlooked, their debts are just as important and can have a very real impact on how the divorce is resolved.  Dividing debt or figuring out who has to pay for the house and the car is just as important as figuring out who gets them.


Most people, even if they have been careful with their money, have some kind of debt. A mortgage on their home, loans for their cars, credit card debt, and even student loans that haven’t been paid off yet. Deciding how to divide this debt when you get divorced can be tricky, however, and often leads to conflict.


Under Michigan law, division of marital property is done by way of “equitable distribution.” This means that if the court is required to divide up your assets between you and your spouse, the division will likely not be an even 50/50 split, but the court will attempt to perform the division in the fairest way possible.


Family law attorney, Brandy Thompson says, “For most clients, there is actually a presumption of a 50/50 split. But there are a host of factors that the court can consider that may sway them one way or the other. We advise our clients never to expect a clean cut down the middle.”


Caselaw has established a list of facts that the court often considers when dividing debt and assets between spouses during a divorce. As a result, there may some inequality when debts are divided, based on what the court decides is most fair for that circumstance. This list includes some of the more common factors that the court considers when dividing debt and assets:


  • the length of the marriage
  • the needs of the parties
  • the needs of the children
  • the earning power of the parties
  • the source of the assets / debts
  • the cause of the divorce, including fault in the breakdown of the marriage


When assets and debt are divided, either by the divorcing couple or by the court, it will be clearly indicated in your divorce judgement who gets what assets, and who is responsible for what debts. However, it isn’t all that uncommon for someone to be unable to pay the debt assigned to them in the divorce settlement. So what do you do if your ex cannot, or will not pay on a debt and creditors are hounding you for money? Well, you have several options.

Join us next time, when we will be discussing what those options are, and which ones might be best for you. Until then, if you or a loved one are considering divorce and would like some guidance about separation of property and debt division in Michigan, please contact our skilled family law attorneys. We are here to help you, 24 hours a day, seven days a week.