How Do Debts Get Divided in a Georgia Divorce?

In a Georgia divorce, the parties must divide their marital property and debts equitably. As a result, the court always may assign more than half of the marital debt to one party or the other during a divorce, depending on the circumstances. There is no requirement under Georgia law that marital debt be divided equally between the parties. The only requirement is that the division of marital debt be fair. A court can consider different factors in determining the most equitable way to divide marital debt, including the income of each party and his or her ability to repay the debts.

For example, if one spouse incurred a large credit card bill solely for her personal expenses, then the court might order her to pay back that debt. On the other hand, if one spouse earns twice what the other spouse earns, then the court might order her to pay back a larger portion of the debt or a larger number of marital debts. The Georgia divorce court often will either assign certain accounts for each spouse to pay, or the court may require each spouse to pay a certain percentage toward each marital debt until they are paid in full.

Alternatively, the parties may decide to get rid of their debts by using some of their assets to pay them off in full. This would eliminate the marital debt problem altogether. Court also may treat secured debts, or debts that are secured by an asset, such as a house or car, differently. In many cases, if one spouse wants to keep possession of the marital home following a divorce, then that spouse will be required to be responsible for the accompanying mortgage debt. However, parties who elect to keep a secured asset usually will be required to refinance the secured debt in his or her own name. This will relieve the other spouse from any liability, or legal responsibility, for the secured debt.

These rules for the division of debt in a Georgia divorce only apply to marital debt, which is all of the debt that you or your spouse incur, either jointly or separately, after the date of your marriage. It does not matter if only one spouse or both spouses have their name on the loan or credit card account. If it was taken out after the parties’ marriage, it is marital debt. If you borrowed money or ran up a credit card before your marriage, then you are solely responsible for that debt and your spouse will not be ordered to pay it back; it is not considered to be marital debt.

It is important to remember, however, that your spouse being ordered to pay a certain debt does not necessarily let you off the hook. If the debt is a joint account, and your spouse fails to repay it as ordered, a creditor can still come after you for repayment of the debt. If you both signed up for a joint credit card, for example, the credit card company can sue you and eventually garnish your wages if payments are not made. Your only remedy in that case is to bring your spouse back to court in your divorce case. In that court, you can ask that your spouse be ordered to reimburse you for any debts that you ended up having to pay back because he didn’t pay them.

There is one other aspect of division of debt in divorce that is often overlooked.  If you are ordered to pay the debt that is either in your spouse’s name or in his or her joint name, unless the agreement is very specific in regard, you will not be able to go bankrupt against the debt, if doing so would make the other spouse liable or hurt their credit.  There are also other debt complications outside of bankruptcy that must be considered, and these unforeseen consequences must be dealt with.

Shaw Law Firm LLC knows that the division of debt in any divorce, but especially in those divorces involving significant assets, can be complex. Contact us or call today to learn how Shaw Law can work with you to achieve the best outcome possible for you and your children.

Scott Shaw is founder and principle of Shaw Law Firm LLC, founded in 1995 and dedicated solely to divorce, family law and child custody matters that must be addressed and decided in the state of Georgia. Shaw Law Firm serves the greater Metro Atlanta area, particularly the counties of Fulton, Gwinnett, Cobb, Cherokee, Forsyth, Paulding, Henry, Fayette, Coweta, Newton, Walton, Bartow and Douglas. Schedule a consultation today at 770-594-8309.