Family, Criminal & Children's Court Attorneys Since 1991

What happens to debt in Wisconsin divorce?

On Behalf of | Jun 21, 2023 | Divorce |

Despite a relatively low divorce rate in the state of Wisconsin, a good portion of couples in the state eventually end their marriages. One issue that often arises during divorce negotiations is responsibility for marital debt.

Divorce in Wisconsin

First, you should know that Wisconsin has what is called no-fault divorce. That means that no party is deemed responsible for the divorce and who is most guilty for the breakup has no bearing on the outcome. Simply both couples need to tell the judge that the marriage has had an “irretrievable breakdown” and cannot continue.

Wisconsin is also a community property state. This means that property bought during the marriage is deemed as “community property” that is owned equally by both spouses and then divided between them during the divorce. Things that could play into how those assets are divided include:

  • the length of the marriage
  • the income of each spouse
  • property owned before the marriage
  • property bought during the marriage
  • the health of each spouse
  • the education and work experience of each spouse

Debt division

Because Wisconsin is a community property state, debt is viewed as shared by both spouses after a divorce. Exceptions to this include:

  • debt incurred before the divorce
  • debt related to legal torts
  • child support from a previous marriage
  • property bought during the marriage
  • the health of each spouse
  • the education and work experience of each spouse

Something else you should consider is that assets deemed to be marital property can be used to settle marital debt. This means assets can be sold to pay off those debts. If you accrued a lot of debt as a couple, this could be a huge factor to consider.

Overall, both spouses should work with their lawyers to create a preferable divorce settlement instead of having it only decided by a judge. This can avoid serious issues with the outcome of your case.

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