When you get a divorce, it’s natural to be curious about how your property and debt will be divided. While married, couples acquire numerous assets, including houses, cars, and retirement plans. In addition, couples also may acquire debts like a home mortgage or credit card debt. During the divorce process, couples must split both their assets and their debts. Here our Somerset County divorce lawyers explain how the division of debt occurs in a New Jersey divorce.
Understanding Equitable Distribution
New Jersey operates under the principle of equitable distribution in order to divide debts and assets in a divorce. In the equitable distribution process, the judge in the case will make a fair and equitable distribution of the couple’s property, which includes all of their marital property and debts.
Equitable does not mean equal in this case. Judges will take appropriate steps and look at critical factors to distribute assets and debts in a fair and comparable manner for both parties. However, the monetary values may not be exactly the same for each party.
Determining How Debt is Split
According to New Jersey laws, there are 15 different criteria the judge will look at when determining how to distribute assets and debts for a divorcing couple.
Factors that determine how debt and assets are distributed include:
- The length of the marriage;
- Each parties’ age and physical and emotional health;
- The income or property that each party brought to the marriage;
- The standard of living established during the marriage;
- Any written agreements, like a prenuptial or postnuptial agreement;
- Each parties’ economic circumstances after the division occurs;
- Each parties’ income and earning capacity;
- Any contributions made to the education, training, or earning power of the other;
- Any assistance that increased or decreased the couple’s marital property;
- The tax consequences of the proposed distribution of property;
- The current value of the couple’s property;
- The custodial parent’s need to use the marital home;
- The couple’s debts and liabilities;
- The need to create a trust fund to pay for medical or educations costs of a spouse or child;
- If a party delayed achieving their career goals;
- Any other factors the court deems relevant to the case.
The judge will consider all of these factors when they decide how to divide assets or debts. This decision can also affect other matters in the divorce process, like child support or alimony.
Dividing debt in a New Jersey divorce is a complicated matter that is determined by several factors. Working with a skilled Somerset County divorce lawyer can assist you with your property division case by locating all relevant evidence for applicable factors and presenting it to the court in the most favorable way.
If you need advice about how debt will be divided in your divorce, call DeTommaso Law Group today at (908) 274-3028.