Agreeing on Debts


This course follows along with a sample separation agreement which can be downloaded here.

Now let’s talk about how to handle debts in a separation agreement. So you’ll see paragraph number 11 and paragraph number 12 relate to debts. You might decide in your separation agreement that you’re each just going to keep the debts that are in your own name and that you’re not going to obligate the other person to contribute towards those debts or to pay you back for any of the debts that were incurred during the marriage. But one of the very important things to consider is what if there’s a joint debt, or what if your spouse is still listed as an authorized user on one of your debts.

Something that would be a very good idea to consider when you’re thinking about debts and how to distribute debts and how to list exactly who’s going to receive which debt, you might consider getting a credit report just in your own name. It doesn’t matter about the score, what we want to look over is the report itself, and what the report itself is free, you can access it on or, and that report will tell you how the debt’s titled.

Are the debts in joint names, is someone an authorized user but you’re the sole, responsible debtor on that debt, and if so, do you want to remove your spouse as an authorized user? If there’s a joint debt that you didn’t know about, do you want to close that account and make sure you’re no longer liable on that account? Because keep in mind regardless of what we say in the separation agreement, what matters to the creditor, and the only thing that creditor is bound by, is the financing agreement that you signed with the creditor.

So just like the mortgage on the house, as well as a joint car loan or potentially a joint credit card, those are all debts that you’ve signed into with a creditor, and even if in the separation agreement your spouse agrees to pay 50% of that debt, if they don’t pay it, the creditor can still come after¬†you.

So you want to make sure that in addition to making an agreement about how the debt is going to be distributed, you’re also getting your name off of that debt so you can make sure that exactly what your spouse has agreed to pay for actually happens. So, keep in mind, knowing how much debt is in your name versus your spouse’s name is important, and then knowing how are you going to distribute it so that your name is off any debt that your spouse is responsible for.

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