Marital Debt in a Divorce

A court is required to make a fair, reasonable and equitable split of marital property in a divorce. Few people realize that “debt” is a type of property. In fact, section 452.330, RSMo, directly addresses the issue:
“In a proceeding for dissolution of the marriage or legal separation […] the court shall set apart to each spouse such spouse’s nonmarital property and shall divide the marital property and marital debts in such proportions as the court deems just after considering all relevant factors.”
Although this statutory section states that marital debt is to be divided (and goes on to list factors to consider for the division), it does not state what constitutes “marital debt.” The answer lies primarily in case law. Missouri case precedent articulates that marital debt is debt incurred during the marriage or in contemplation of the marriage. The fact that one spouse is not responsible for the debt does not prevent its allocation to that spouse. For instance, then, one spouse could go behind another spouse’s back and take out a home loan; although only one party is responsible, both are on the hook. This rigid rule flows from the legal premise that a married couple is a single entity in the eyes of the law (with a few exceptions). Accordingly, when one incurs debt during marriage, both incur debt.
While on the subject, it is also important to know that nonmarital debt is not reallocated and isn’t relevant when splitting up property during a divorce. Nonmarital debt is simply separate debt that was incurred by one party before the marriage (and not in contemplation of the marriage).