If you and your spouse are separating or divorcing in New Jersey, you may be wondering: Am I responsible for Debt After Separation? The answer depends on several factors, including when the debt was incurred and whether it was joint or individual.
The Truth About Debt, Separation, and Divorce
New Jersey is an equitable distribution state, meaning that debts and assets are divided fairly—but not necessarily equally—during a divorce. Unlike community property states, where all marital debts are split 50/50, New Jersey courts consider factors like income, financial need, and the nature of the debt before assigning responsibility.
Debt Incurred During the Marriage
Any debt taken on during the marriage is generally considered marital debt, meaning both spouses may be responsible, regardless of whose name is on the account. Examples include:
- Mortgage loans – If both names are on the loan, both spouses remain responsible.
- Car loans – If a car was purchased during the marriage, both spouses may be liable for payments.
- Credit card debt – If a credit card was used to pay for shared expenses like groceries, household bills, or family vacations, the debt may be divided in the divorce.
However, if one spouse accumulated debt for personal expenses (e.g., gambling, luxury purchases, affairs), the court may assign that debt solely to them.
Debt Incurred After Separation
Once you and your spouse separate, any new debt is typically considered individual. For example:
- If your spouse takes out a new loan after you separate, they are solely responsible.
- If your spouse opens a new credit card in their name, they will bear the responsibility.
However, there are exceptions. If a spouse incurs debt after separation to benefit the family—such as paying for household bills, child expenses, or necessary maintenance—it may still be considered marital debt.
Joint Debts After Divorce
Even after divorce, joint debts can create financial risks. If your name remains on a joint loan or credit card, creditors can come after you for payments—even if your divorce decree says your ex is responsible.
To protect yourself:
- Close joint accounts – Ensure that all shared credit cards and loans are either paid off or transferred to an individual account.
- Refinance loans – If one spouse is keeping the home or car, they should refinance the loan in their name only.
- Monitor your credit – Keep an eye on your credit report to ensure no unexpected debts appear under your name.
Options for Managing Debt After Separation
If you and your spouse have significant shared debt, here are three common ways to handle it:
- Pay Off the Debt Together – If possible, paying off all joint debts before the divorce is finalized can prevent future financial complications.
- Divide and Assign Debts – Some couples agree to take responsibility for specific debts in exchange for certain assets or property.
- Negotiate a Payment Plan – If neither party can immediately pay off the debt, working out a payment arrangement may be the best option.
Do you have more questions about debt and divorce? Here are some common concerns:
What happens if my ex-spouse stops paying our joint debts?
Can I remove my name from joint debts after a divorce?
Can I take legal action if my ex-spouse doesn’t pay joint debts?
Can I be sued for joint debts my ex was supposed to pay?
Navigating debt and financial matters during separation and divorce can be complex. If you’re concerned about your financial future, consulting an experienced New Jersey divorce attorney is crucial.
At Adamo Ferreira Esq LLC, we can help you understand your legal rights, negotiate fair settlements, and protect your financial well-being during and after divorce. Contact us today for a consultation.
Phone: +1 201-343-1171