Two of the most difficult financial situations that you are likely to face include debt and divorce. When the two are combined, it can become quite difficult to keep perspective. When it comes time to divorce, it is apparent that the division of debt — and who is responsible for it — is a big deal.
Who is Responsible for Debt?
In most cases, responsibility for debt is fairly cut and dry. If you have debt in your name, and your name only, you are responsible for that debt. You are not responsible for student loans that your spouse acquired, and you do not have to repay Revenue Canada if your spouse (but not you) owes back taxes. If you have kept your assets mostly separate, the question of debt during divorce is fairly straightforward.
Things get a little dicey, though, when it comes time to divvy up the joint debt. If you have joint credit cards, or other loans, the lender will hold you both responsible for the payment of the debt. In many cases, it is best to use joint assets to pay of joint debt so that you can both get a new start. However, there are some instances in which this is not possible. You can either divide up the debt according to income that you both make, or by using some other means. You will have to make sure that your ex pays, though, or your own