Illinois Divorce Law on Credit Card Debt

By Wayne Thomas

Credits cards are a common way to purchase items when you need them. If you are married, you may not give a second thought to how this debt will be treated in the event that you divorce. Credit cards present some unique issues during property division -- and Illinois, like other states, has specific rules for assigning responsibility between divorcing spouses.

Defining Marital Debts

Debts are allocated between spouses as part of the property division phase of a divorce in Illinois. To qualify for division, the debt must be classified as "marital," which includes most liabilities incurred during the marriage and before the date of separation -- regardless of which spouse's name is on the debt. All other debts are considered "separate" and remain the responsibility of the spouse that incurred them.

Timing of Charges

If a couple opens a joint credit card during marriage, the debt incurred is typically classified as a marital debt. By contrast, if either spouse has a credit card coming into the marriage, the balance on the card would be considered a separate debt. However, complications can arise if purchases are made during the marriage on a card titled solely in one spouse's name. Here, the court will to look to see who benefited from the purchases. If the cardholder spouse benefitted from the purchase alone, the debt likely would be classified as separate. If the family benefited from the purchase, the debt would be considered as marital.

Divorce is never easy, but we can help. Learn More

Division Factors

Any credit card balances classified as marital debt are divided along with other property and debts on the basis of fairness between you and your spouse. It is important to note that this does not necessarily mean the division will be equal, as the court is allowed to consider several factors outlined in state law. These factors include the specific needs of you and your spouse, the length of the marriage, the amount of any spousal support awards and the nature of any custody awards.

Other Issues

Judges have the freedom to order either one or both spouses to take responsibility for a credit card balance. However, Illinois courts are aware of issues that can arise with this type of debt, particularly if only one spouse is listed on the account. By law, the cardholder remains contractually obligated to the credit card company even if the court assigns the debt to the other spouse in the divorce. This in turn could affect the cardholder's credit rating if the other spouse fails to make required payments. To avoid this result, the court may decide to keep the marital debt solely with the cardholder, but then offset the award with a larger share of marital property.

Divorce is never easy, but we can help. Learn More
Florida Laws on Credit Cards & Divorce
 

References

Related articles

How to Assign Depreciated Value in a Divorce

When your and your spouse separate, you're splitting up not only your personal union, but also your economic one. You may have accumulated significant assets — and significant debts — during your time together. Unfortunately, economic turmoil may have resulted in substantially reduced value in one or more of your major marital assets. Additionally, normal wear and tear may have caused an asset to depreciate even in a strong economy. Regardless of how the depreciation came about, depreciated value and the loss it creates can be assigned in your divorce just like a gain.

Divorce Laws and Automobiles

As you go through the divorce process, you and your spouse will work to divide all marital property, including debts, assets and real property. Spouses can either come to an agreement privately through a marital settlement agreement or go through the court system where a judge will divide property according to state law. Some states, known as community property states, divide marital property equally between spouses. Most states, however, distribute property equitably between spouses, not necessarily equally, after evaluating several factors, such as the duration of the marriage and each spouse's age and contributions to the marriage. With vehicles, the asset is typically awarded to one spouse and requires refinancing and retitling of the property.

Texas Divorce Laws on House Disputes

Because Texas is a community property state, courts in Texas generally divide property equally following a divorce. However, the situation is more complicated when it comes to a house. Which spouse gets the house is largely dependent on when the home was purchased as well as where the mortgage payments are coming from. In some cases, the spouse who does not get the house will instead receive a greater portion of the remaining marital property, while the spouse with the house may receive more of the marital debt.

Get Divorced Online

Related articles

Community Property Laws & Credit Cards

Where you live largely determines how your credit card debt is split in a divorce. As a resident of a community ...

How to Take a Spouse Off a Credit Card Before a Divorce in Arizona

A looming Arizona divorce can present difficult financial tangles, as each spouse prepares to claim a share of the ...

How Is Debt Split in a Divorce in California?

During a divorce, many couples focus on the division of community assets and often don’t realize that marital debt is ...

Who Pays the Debts in Texas Divorces?

Texas is technically a community property state, but when it comes to divorce, it does things a little differently from ...

Browse by category
Ready to Begin? GET STARTED