Marital Debt in North Carolina

marital debt

If you are facing divorce, you are probably anticipating division of your property and assets between your spouse and yourself. Have you also considered that your debts are a major part of your marital property?

The question is not only who gets the house, the cars and the big screen TV, but who gets the mortgage, the car loans and the credit card debt as well.

Debts incurred during a marriage may seem manageable enough when you and your spouse are combining resources. But debts can become much more significant when you must pay them by yourself.

Many couples have large debt that reduces their marital net worth. So division of debt is just as important in a separation or divorce as division of assets.

What Is Marital Debt in North Carolina?

Marital property is property acquired by one or both spouses during the marriage and owned on the date of a formal separation. All debts and liabilities incurred during the marriage, including mortgage, credit card debt, student loans and marital business debts, are considered part of the marital property.

In other words, you are both responsible for the debt, and it is considered part of the marital estate.

Understanding Division of Marital Debt in North Carolina

A decision on who gets what property and debt in a divorce can be made in two ways.

The first and generally best way is to arrive at an agreement with your spouse and to put that agreement in writing. A separation agreement is a legal contract between husband and wife addressing the issues involved in a divorce, such as child custody, support, and division of marital property, including debt.

In some cases, spouses may have difficulty reaching an agreement. If that happens in your case, you might consider a certified family law mediator to facilitate the process.

If you and your spouse cannot arrive at an agreement, then you will need to resort to the second method of determining division of marital property and debt – to let the court decide.

When Is Division of Marital Debt Determined?

In North Carolina, you must have been separated for at least one year with the intent of permanent separation before the court will grant you a divorce. A good time to determine the division of marital property, including debt, and other terms of the divorce is when you legally separate. These terms can be stated in the separation agreement that you and your spouse will sign.

It is important to retain a knowledgeable family law attorney to prepare your separation agreement, or to review it if the agreement was prepared by your spouse’s attorney. A lawyer with Charles R. Ullman & Associates can prepare or review your separation agreement to make certain that all factors are considered and your interests are protected.

Factors in Dividing Marital Property

Although courts tend to favor a 50/50 division of marital property in most cases, there are a number of things that affect decisions on who gets what property and what debt.

When the court decides how marital property is divided, it considers such factors as:

  • The length of the marriage
  • The age and health of the spouses
  • Income, property and liabilities
  • Pension or retirement expectations
  • Obligations for support from a previous marriage
  • Contribution to marital property
  • Contribution to education or career of one spouse by the other
  • Tax consequences
  • Character of the assets (liquid or non-liquid)
  • Need for a custodial parent to remain in the marital home

Does Marital Misconduct Affect Property Division?

The only type of marital misconduct that affects the distribution of assets is misconduct that hurts the value of the marital estate. Examples would be reckless spending, waste of assets, hiding financial accounts during a divorce or selling assets below their value.

If you suspect your spouse of engaging in this type of misconduct, contact our firm as soon as possible. Our experienced divorce attorney can help you pursue the proper division of assets and debt in your separation agreement and seek a temporary injunction if necessary to protect your rights.


Charles Ullman & Associates provides you respected, experienced and knowledgeable divorce and family law attorneys. You can trust us to help you through the legal process efficiently and effectively so you can transition to the next phase of your life. Our community involvement reaches beyond charitable support of important causes. We launched our own movement in Fraternities4Family and provide scholarships to able students in need.