When Divorcing, Should I Pay Off Marital Debts?
There are an array of assets and liabilities that need to be divided when a couple separates and divorces. When this happens, the question of whether to pay off marital debts before finalizing the divorce may arise. Before making a decision on paying off debts, talk to an experienced Tampa family lawyer who can review your circumstances and provide insights into whether paying off debts before divorce is the right choice for you.
Reviewing the Pros and Cons
Settling marital debts before divorce can simplify the division of assets. When there are no outstanding financial obligations, it becomes clearer how remaining assets, such as property, investments, and personal belongings, can be equitably distributed.
Additionally, paying off joint debts can protect your credit score. Outstanding debts, especially those with joint responsibility, can affect both parties’ credit histories. Clearing these debts before divorce ensures that each spouse can start their post-divorce life with a clean financial slate.
There are also situations when a couple chooses to eliminate debts to reduce conflict and future financial ties. Once the divorce is finalized, it is common for each party to want to move forward without the worry of being connected through ongoing financial obligations.
Of course along with pros there are cons. For instance, using joint assets to pay off debts may deplete the pool of assets available for division, which could impact both parties’ financial well-being post-divorce. This is especially true if a couple has limited assets.
An imbalance could also occur if one spouse uses personal funds to pay off debts. If you feel you are shouldering a disproportionate share of the financial burden for marital debt, it may be beneficial to have debts fully reviewed before paying them down. It is also important to recognize that without a thorough financial examination there could be hidden debts you are not aware of.
Opting to Not Pay Debts
Putting a pause on your debt pay off plan before a divorce may be the best bet as it will allow for a complete review of marital finances. When you hire a lawyer, they will carefully analyze all marital assets, ensuring that debts are distributed equitably. An array of factors will be taken into account, including the income of both spouses, marital assets, debts that were brought into a marriage and liabilities gathered through the course of the union.
Consulting with a Tampa family lawyer is a key step to protecting your rights today and securing the future you want post-divorce. Whether you choose to pay off debts or not, obtaining legal advice early in the divorce process is a proactive step towards achieving a fair and equitable resolution.
How are you handling your marital debts? The decision of whether to pay off marital debts before divorce is not the same for everyone. To have your unique concerns addressed, consult with the legal team at Blair H. Chan, III. Lawyers are available to ensure your rights and financial interests are protected. Schedule an initial consultation today, call 813-280-5301.