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Confusion When Collecting from Divorced Couples

Posted on in Debt Collection

Confusion When Collecting from Divorced CouplesA couple going through a divorce must divide their debts as well as their assets. Each spouse takes responsibility for paying off a portion of the marital debt, such as a:

  • Mortgage;
  • Credit card balance;
  • Personal loan; or
  • Medical bill.

Divorcees may mistakenly believe that they are not liable for the debts that their former spouse assumed. As a creditor, you are not bound by the terms of a divorce agreement and have the right to pursue repayment of the debt from either spouse after the divorce.

Loan Contract vs. Divorce Agreement

You can give a clear explanation to a debtor who argues that the debt belongs to his or her former spouse:

  • Dividing debts during divorce is a personal agreement about who should be responsible for paying a debt; but
  • The loan agreement is unchanged and has the names of both former spouses, making each of them legally liable for the debt.

Removing their name from a title or deed does not absolve them of a debt associated with that property. They would need to negotiate with you to remove one of them from debt contract. They can instruct you that one of them has agreed to take responsibility for the debt, but you can ask the other party to pay the debt if the preferred party cannot fulfill the payments. The debtor’s complaint should be with his or her former spouse for not following the terms of the agreement and indemnifying him or her from the debt.


Debtors who recently divorced have fewer available assets, which may increase the risk of them filing for bankruptcy. If the couple files for bankruptcy together, then they may both be able to discharge the debt. If a divorcee individually files for bankruptcy, you can still collect the debt from the other person who is named in the loan agreement. How the case proceeds depends on the type of bankruptcy:

  • In Chapter 7 bankruptcy, the filer is still obligated to protect his or her former spouse from the debt he or she agreed to pay; but
  • In Chapter 13 bankruptcy, the filer no longer has such an obligation, allowing you to deal more directly with his or her former spouse.

Contact a Chicago Creditor’s Rights Attorney

Collecting from debtors who have divorced can be complicated, depending on how they agreed to divide their debts and the money they have available to make payments. A Chicago debt collection lawyer at Walinski & Associates, P.C., will help you hold divorcees accountable for their debts. Schedule a consultation by calling 312-704-0771. 


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