What Happens with Credit Card Debt in an Illinois Divorce?

 Posted on November 27, 2023 in Divorce

Credit card debt is a widespread issue across America and poses a particular challenge during divorce. If either spouse has student loans, a mortgage, personal loans, or credit card debt, what happens to it will be decided as part of the debt division to be settled in divorce proceedings. If you are considering divorce and are concerned about your spouse’s credit card debt, a knowledgeable divorce lawyer can offer insight into the process and help you protect your rights.

How Is Debt Distributed in Illinois?

Illinois is considered an “equitable distribution state” for the division of both assets and debts. This means that decisions about how assets and debts will be distributed in divorce will be guided by the goal of ensuring that neither spouse is unfairly financially disadvantaged. However, several other issues will be taken into consideration, including:

• The needs of each spouse
• The personal assets that each spouse has
• How long the couple was married
• The financial resources each spouse has
• If one spouse will be paying the other spousal maintenance or child support
• The nature of purchases made on credit cards
• Who benefited from the debt
• When the debt was incurred (was it during the marriage or before it?)

Marital Debt vs. Non-marital Debt

An important factor in deciding what will happen to any debt during divorce is whether it is considered marital or non-marital debt. The state of Illinois considers anything that was acquired during the marriage itself to be marital debt and anything that was acquired before the couple was married is considered non-marital debt, but there are exceptions to this definition.

For example, if debt was incurred during marriage but it solely benefited one spouse, it might be considered non-marital debt and would not need to be shared with the other spouse in a divorce. On the other hand, if the debt is accrued on a credit card under the name of only one spouse, but it reflects purchases that benefitted both, this might be considered marital debt.

If the couple has a prenuptial or postnuptial agreement that classifies which debts are marital and which are non-marital, this makes the decisions about the division of debt much simpler. Otherwise, the court needs to decide this.

Schedule a Free Consultation with a Wheaton, IL, Debt Distribution Lawyer

If you are considering divorce but are concerned about what will happen with your spouse’s debt in your divorce settlement, an experienced DuPage County, IL, debt distribution lawyer can arm you with the knowledge you need to best represent your rights and interests. At Goostree Law Group, we offer free consultations, so call 630-364-4046 to get started.