Ending a marriage is a decision that comes with serious financial consequences. For many couples, one of the most significant areas of stress is the division of assets and debts. Knowing how North Carolina divides debt during divorce can help you plan ahead, budget, and get ready for the next stage of your life.
North Carolina as an Equitable Distribution State
North Carolina, like many other states, is an equitable distribution state. This means that assets and debts should be divided in an equitable and fair way. Note that “equitable” does not mean “equal.” Debt is unlikely to be split 50/50. While considering a fair distribution of debt, the court looks into factors like the length of the marriage, each partner's earning potential, how much each partner contributed to the marriage, the ability of each partner to repay the debt, and each partner's educational levels.
What is Considered Separate Debt and Marital Debt?
North Carolina law views marital and separate debt in two different ways. Marital debt is debt taken on after the couple entered into a marriage contract. This debt is generally split in an equitable fashion. Separate debt is debt that one partner has before entering into the marriage. This is typically not divided during a divorce. However, there are some circumstances in which these rules do not apply, which is why it's crucial to discuss the details of your case with a divorce lawyer.
What to Do If Your Partner Hides Debt From You
Some partners are, essentially, scammed by their ex-partner. Their ex-partner may have opened up lines of credit behind their back or taken on other types of debt without informing their spouse. If this has happened to you, you may wonder if you are on the hook for your partner's irresponsible spending. You should discuss this with an attorney as soon as possible; if the debt did not serve a marital purpose, it may remain the obligation of one partner and not the other.
Negotiating With Your Ex-Partner
In most cases, decisions regarding property division do not come down to North Carolina law. They come down to the agreement reached by both parties and their attorneys. Agreements are based on a number of factors, including each party's earning ability, assets kept by each party, and each party's willingness to compromise. It's important to go to the negotiating table with an experienced family law attorney who can advocate for you and negotiate an agreement that represents your best interests.
Wondering what your financial future will look like after divorce? Take the first step toward your new life now by contacting NC Adoption Law Center. Call us at 704-861-0700 to schedule your consultation.