During a divorce, many people can get lost focusing on their assets. However, depending on your situation, the debts accrued during the marriage may carry a heavier weight then you realize. Understanding what may happen to your debts in the event of divorce is critical for maintaining your financial well-being and ensuring an easier start after the divorce.

Understand Community Property Vs Equitable Distribution

The laws in the state you live in dictate how liable each partner is for the debts of their spouse. Many states fall into one of two categories: community property states and equitable distribution states.  

In community property states, each partner is equally liable for the debts incurred during the marriage. This applies even if you didn't know your spouse signed for the debt. During divorces in a community property state both parties need to be prepared to completely list the debts and assets incurred during the marriage.

In an equitable distribution state, the burden of debt is determined by many factors. Things like the length of the marriage, the health of both partners, and the name on the debt come into play. There is much more room for debt discussion in an equitable distribution state.

Know That Your Creditor Doesn't Care About Your Divorce

Let's say you get divorced in a community property state and your ex is on the hook for a debt with your name on it. Typically, the company that holds that account won't care about what the court decided during the divorce. That creditor will continue to come after you because your name is the one on the bill.

In order to protect yourself in this scenario aim to get an indemnity clause during your divorce. This way if your ex doesn't pay, your clause will allow you to take your ex to court to recover what they haven't paid.

Prepare For Financial Health Before Your Divorce

Not all financial aspects of a divorce are decided in court. Keeping your credit healthy before and after your divorce may require some financial strategy. Before your divorce is finalized, you may want to pay off any shared debts or get items refinanced into one partner's name. This allows you to have a fresh financial start after the divorce.

If you were highly dependent on your partner's credit, you'll have to start building your own. Pull your credit report and begin talking with your bank about the best financial moves you can make to build your credit after your divorce.

Divorces aren't easy but you can make it easier by getting legal representation. Having a lawyer in your corner will help to ensure you're able to maintain your financial well-being after a divorce.