Divorce doesn’t just split up furniture and bank accounts. It also splits up what a couple owes. Divorce lawyers in Maryland help spouses figure out who is responsible for what when credit cards, mortgages, and personal loans are still outstanding.
Maryland courts use an equitable distribution approach, which means marital debt division doesn’t automatically equal a fifty-fifty split. Instead, judges weigh a set of factors to decide what’s fair for each spouse.
Marital Debt vs. Separate Debt
Before a court can divide anything, it has to sort out what counts as marital debt. In Maryland, debt taken on to acquire marital property may itself be treated the same way as marital property, subject to equitable distribution between spouses. This is often the first question divorce lawyers in Maryland walk clients through. There are several common types of marital debt.
- Credit card balances that increased during the marriage for the purpose of purchasing marital property
- A mortgage on the family home
- Car loans taken out while married for a vehicle that counts as marital property
Separate debt usually includes anything one spouse brought into the marriage or debt taken on after separation for a purpose unrelated to the family, such as a student loan from before the wedding. Some debt falls into both categories. If one spouse had a credit card before marriage but the couple used it together for marital property, part of that balance may be treated as marital, which is where divorce attorneys in Maryland can help build the record.
How Maryland’s Equitable Distribution Law Works
Maryland is an equitable distribution state, not a community property state. In community property states, marital debt is often split fifty-fifty. In Maryland, the goal is fairness, not an even split. Under Maryland Family Law Code Section 8-205, courts weigh 11 statutory factors in deciding the monetary award in a Maryland divorce, including:
- Each spouse’s monetary and nonmonetary contributions to the marriage
- The worth of the assets and property owned by each spouse
- Each spouse’s economic situation when the award is made
- The duration of the marriage along with each spouse’s age and physical and mental condition
- How and when specific marital property or interest in property was acquired
Judges have real discretion here. Two couples with similar debt loads can end up with different outcomes depending on income, earning potential, and who benefited from the borrowed money. This is one reason people search for divorce lawyers in Maryland rather than handling marital debt division on their own.
Credit Cards and Joint Accounts
Credit card debt is a common flashpoint in a Maryland divorce, largely because of how joint accounts work. If both spouses’ names are on an account, both may be contractually responsible for the full balance, regardless of who made the charges or what a divorce settlement says about who is supposed to pay it. That part surprises a lot of people.
A divorce decree may require one spouse to pay off a specific credit card debt, but that arrangement exists solely between the two parties involved. It doesn’t rewrite the agreement either of them signed with the credit card company. If the spouse assigned the debt stops paying, the card issuer can still pursue the other spouse for the full amount, and it can affect that spouse’s credit. Because of this, divorce attorneys in Maryland may address closing joint accounts, refinancing shared debt into one spouse’s name, or building indemnification language into the settlement agreement that gives the other spouse a clear path back to court if a payment gets missed.
Mortgages and Personal Loans
Mortgage division in a Maryland divorce presents a similar issue. Taking a name off the title of the marital home doesn’t take that name off the mortgage. As long as both spouses signed the loan, both remain liable to the lender until it’s paid off, refinanced, or the house is sold.
Maryland courts have a few options for the marital home, such as ordering it sold with proceeds divided, allowing one spouse to buy out the other’s interest, or letting one spouse stay for a set period first. Whatever the court decides about ownership, removing a spouse’s name from the mortgage typically requires a separate step, like refinancing.
Personal loans and auto loans follow the same principle. Responsibility assigned in a divorce judgment is enforceable between spouses. Still, it doesn’t change what the lender can do if the account was opened jointly, which is why splitting loans in divorce takes more than a line in a settlement agreement.
Why Milstein Family Law Helps Clients Think Ahead on Debt
Debt division isn’t a formality tacked onto the end of a divorce. It shapes each spouse’s finances for years afterward. That’s why the attorneys at Milstein Family Law spends real time walking clients through their full financial picture before agreements are finalized. We help clients identify which debts are marital, which are separate, and where the two overlap.
If you’re experiencing a divorce in Maryland and have questions about how your debt will be handled, contact us online or call (443) 230-4674 to schedule a consultation.
