When you divorce in Illinois, you divide debts along with assets. Mortgages, credit cards, auto loans, student loans, medical bills, and other obligations must all be addressed as part of your property division.
Illinois is an equitable distribution state. This means courts divide debt fairly based on circumstances, not automatically 50/50. The goal is a fair outcome, not an equal split.
Key rules Illinois courts follow when dividing debt:
- Debt incurred during the marriage is presumed marital under 750 ILCS 5/503(a), regardless of whose name is on the account
- Debt incurred before marriage generally stays with the spouse who incurred it
- Creditors are not bound by your divorce decree, so if your name is on a joint account, creditors can pursue you even if your spouse was ordered to pay
- The Illinois Family Expense Act (750 ILCS 65/15) makes both spouses liable for medical bills and other family expenses incurred during marriage
- Courts balance debt allocation with asset division so neither spouse is left unable to pay
Understanding these rules helps you prepare for negotiations and protect your financial future. At Anderson Boback & Marshall, our attorneys have handled complex property division cases in Cook, DuPage, Lake, and Will counties for over 35 years. We understand how Illinois courts approach debt allocation and can help you navigate this process.
How Illinois Courts Classify Marital and Non-Marital Debt
The first step in dividing debt is classification. Illinois law distinguishes between marital debt and non-marital debt, and this classification determines how the debt will be handled.
What is Marital Debt in Illinois?
Under 750 ILCS 5/503(a), marital property includes “debts and other obligations” acquired by either spouse during the marriage. This means debt incurred from the date of marriage until separation or filing is generally marital debt.
It does not matter whose name is on the account. If you took out a credit card during your marriage and only your name is on it, that debt is still marital. If your spouse financed a vehicle in their name alone during your marriage, that debt is also marital.
Marital debt is subject to equitable division. The court will allocate it between spouses based on factors including income, earning capacity, and overall property division.
What is Non-Marital Debt in Illinois?
Debt acquired before the marriage generally remains the responsibility of the spouse who incurred it. Under the Family Expense Act (750 ILCS 65/5), you are not liable for debts your spouse incurred before your marriage.
For example, if your spouse had $30,000 in credit card debt before you married, that debt typically remains theirs.
When Classification is Not Obvious
Some debts fall into gray areas that require careful analysis. Student loans taken during marriage are technically marital, but Illinois courts often assign them to the borrower who obtained the degree. Debt refinanced during marriage may convert from non-marital to marital if both spouses participated. Business debt may be partially marital depending on when the business started and how it was funded.
If you have debt that does not fit neatly into one category, an experienced attorney can help you understand how Illinois courts are likely to treat it.
How the Debt Division Process Works in Illinois
Dividing debt in an Illinois divorce follows a structured process. Understanding these steps helps you prepare and ensures nothing is overlooked.
Step 1: Identify All Debts
Both spouses must disclose all debts on their financial affidavits. This includes mortgages, credit cards, auto loans, student loans, medical bills, tax debt, personal loans, and any other obligations.
Review credit reports to identify accounts you may have forgotten. Request statements showing current balances. If you suspect your spouse has hidden debt, your attorney can use discovery to uncover it.
Step 2: Classify Each Debt
For each debt, determine when it was incurred and what it was used for. Debts incurred during marriage for family purposes are marital. Debts incurred before marriage or for purely individual purposes may be non-marital.
Document the origin of each debt. When was the account opened? What was purchased? This information becomes important if classification is disputed.
Step 3: Value the Debts
Determine the current balance of each debt. For mortgages, obtain a payoff statement from the lender. For credit cards and loans, get current statements showing the balance as of a specific date.
Step 4: Allocate Debts as Part of Overall Division
Illinois courts consider debt allocation alongside asset division under 750 ILCS 5/503(d). A spouse receiving more assets may also receive more debt responsibility. Courts consider each spouse’s income, ability to pay, and overall financial picture.
The goal is balance. If you receive the house, you will likely also receive the mortgage. If your spouse receives more liquid assets, they may be allocated more unsecured debt.
Step 5: Address Joint Accounts
Joint debts require special attention because both spouses remain liable to the creditor regardless of what your divorce decree says. Options include paying off the debt before finalizing, refinancing into one spouse’s name, transferring balances to individual accounts, or including indemnification language in your settlement.
Step 6: Document Everything
Every debt should be specifically addressed in your settlement agreement or judgment. Debts not addressed may create disputes later. Be thorough and list every obligation, even small ones.
Types of Debt Divided in Illinois Divorce Cases
Different types of debt are handled differently. The table below summarizes how Illinois courts typically approach common debt types.
| Debt Type | Typically Marital? | How Illinois Courts Handle It |
| Mortgage | Yes, if acquired during marriage | Usually follows the house. Spouse keeping home assumes debt. Refinancing or assuming the mortgage is required to remove other spouse from liability. |
| Credit cards | Yes, if incurred during marriage | Divided based on purpose of charges. Dissipation claims are possible for non-marital spending. |
| Auto loans | Yes, if acquired during marriage | Usually follows the vehicle. |
| Student loans | Often assigned to borrower | Timing, benefit to marriage, and refinancing affect outcome. |
| Medical debt | Yes, under Family Expense Act | Both spouses liable for family medical expenses under 750 ILCS 65/15. |
| Business debt | Depends on business classification | Allocated with business valuation. Personal guarantees remain. |
| Tax debt | Depends on when incurred | IRS can pursue both spouses for joint returns. |
| Family loans | Depends on documentation | Often treated as gifts without written agreement and repayment history. |
For a detailed discussion of credit card debt specifically, see our article on credit card debt and divorce in Chicago.
Who Pays the Mortgage When You Divorce in Illinois?
Mortgage debt is often the largest obligation couples face in divorce. How it is handled depends on what happens to the house.
If One Spouse Keeps the House
The spouse keeping the family home typically assumes responsibility for the mortgage. However, your divorce decree does not remove the other spouse from the loan. The lender was not a party to your divorce and is not bound by your agreement.
Until the mortgage is refinanced into one spouse’s name only, both spouses remain liable. If the spouse keeping the house stops making payments, the lender can pursue the other spouse and damage their credit.
To protect yourself, require refinancing within a specific timeframe. Include a provision that the house must be sold if refinancing is not possible by the deadline.
If the House is Underwater
When you owe more than the house is worth, options are limited. You can sell and split the shortfall between spouses. One spouse can assume the negative equity in exchange for other assets. Or you can negotiate a short sale with the lender.
The court will consider this negative equity when balancing the overall property division.
If the House is Sold
When the house is sold, mortgage debt is paid from the proceeds. Remaining equity is divided between spouses. If the proceeds do not cover the mortgage, both spouses may be responsible for the shortfall.
Who Pays Student Loans in an Illinois Divorce?
Student loans are one of the most commonly misunderstood debt types in divorce.
Student Loans Taken Before Marriage
Student loans incurred before marriage are generally non-marital. The borrower remains responsible. Illinois courts typically do not require the other spouse to contribute to pre-marital education debt.
Student Loans Taken During Marriage
Under Illinois law, debt incurred during marriage is technically marital. However, courts often assign student loan debt to the spouse who obtained the education and degree. This is a practical recognition that the degree and its earning potential benefit the borrower going forward.
Factors that may change this analysis include whether one spouse supported the household while the other attended school, whether the degree significantly increased family income during the marriage, and whether both spouses understood the debt was being incurred for mutual benefit.
Refinanced Student Loans
If you refinanced student loans during marriage and your spouse cosigned, the debt may be treated as marital even if the original loans were non-marital. The same applies if the refinancing used marital income to qualify.
Can Creditors Come After You for Your Spouse’s Debt After Divorce?
This is critical information that many people do not understand until it is too late.
Your Divorce Decree Only Binds You and Your Spouse
When an Illinois court orders your spouse to pay a joint debt, that order binds your spouse. It does not bind the creditor. The creditor was not a party to your divorce and has no obligation to honor your agreement.
If your name is on a credit card, mortgage, auto loan, or any joint debt, the creditor can pursue either spouse regardless of what your divorce decree says. If your ex-spouse stops paying, creditors can come after you. Late payments will damage your credit even if your spouse was ordered to pay.
How to Protect Yourself
Pay off joint debts before finalizing divorce if possible. Refinance debts into one name so only the responsible spouse is liable. Transfer credit card balances to individual accounts. Close joint accounts to prevent new charges.
Include indemnification language in your settlement. This means your spouse agrees to reimburse you if you are forced to pay their allocated debt. Monitor accounts until debts are fully paid or refinanced.
If your ex-spouse fails to pay debt they were ordered to pay, you can file a contempt petition to enforce the divorce decree. However, this does not stop creditors from pursuing you in the meantime.
Common Debt Situations in Illinois Divorce
Every divorce involves unique circumstances. Here are common situations we see and what you can do.
What If My Spouse Ran Up Debt Without My Knowledge?
You may still be responsible for debt incurred during your marriage even if you did not know about it. However, if you can demonstrate the debt was hidden and used for non-marital purposes, the court may assign it entirely to your spouse.
What you can do:
- Request discovery to identify all debts
- Document that you were unaware of the debt
- Show the debt was not for family benefit
- Argue dissipation if the debt was wasted on non-marital purposes
What If My Spouse Has Significant Business Debt?
If your spouse owns a business, business debt adds complexity. The debt is typically considered alongside the business valuation.
What you can do:
- Ensure the business is properly valued
- Determine if you personally guaranteed any business debt
- Negotiate that business debt follows the business to your spouse
- Address personal guarantees specifically in your settlement
What If My Spouse Refuses to Pay Debt They Were Ordered to Pay?
Your divorce decree is enforceable against your spouse, but creditors can still pursue you for joint debt.
What you can do:
- File a contempt petition against your spouse for violating the divorce decree
- Pay the debt yourself to protect your credit, then seek reimbursement
- Include indemnification language in your original settlement
- Consider whether refinancing or payoff should have been required earlier
What Happens to Debt Incurred After Separation in Illinois?
Timing matters significantly in Illinois divorce.
After Separation but Before Filing
Debt incurred after spouses separate but before divorce is filed falls into a gray area. Illinois courts examine the circumstances.
If one spouse controlled the finances and the other needed to incur debt for basic living expenses, that debt may still be considered marital. Debt incurred for discretionary purchases or a new relationship is more likely assigned to the spouse who incurred it.
After Filing for Divorce
Debt incurred after the divorce petition is filed is more likely treated as individual responsibility. However, this is not automatic. Courts still consider the purpose of the debt and whether it benefited the family.
How Illinois Courts Decide Who Pays What
When spouses cannot agree on debt allocation, the court decides based on factors listed in 750 ILCS 5/503(d).
Courts consider each spouse’s income and earning capacity, current financial obligations and needs, the purpose of the debt, which spouse is better positioned to pay, the overall balance of asset and debt division, whether one spouse wasted marital funds, the length of the marriage, and each spouse’s age and health.
Illinois courts try to ensure neither spouse is left in an untenable financial position. A spouse receiving more assets may also receive more debt. A spouse with higher income may be allocated more debt responsibility.
The goal is equity, not equality. What is fair depends on the specific circumstances of your case.
CTA: Schedule a confidential consultation with trusted Illinois divorce attorneys today
Common Mistakes When Dividing Debt in Illinois Divorce
Assuming the Divorce Decree Protects You From Creditors
It does not. If your name is on a joint account, creditors can pursue you regardless of what your divorce agreement says. Refinancing or payoff is necessary for true protection.
Not Addressing All Debts in Your Settlement
Debts not specifically addressed may create disputes later. List and allocate every debt, even small ones, in your divorce decree.
Forgetting About Tax Debt
If you filed joint tax returns, the IRS can pursue either spouse for unpaid taxes. Address any potential tax liability in your divorce.
Not Refinancing Joint Debts
Agreeing that your spouse will pay a joint mortgage or auto loan is not enough. Until the debt is refinanced into one name, both spouses remain liable to the creditor.
Overlooking Personal Guarantees
If you personally guaranteed your spouse’s business debt during marriage, you remain liable even if your spouse keeps the business. Address guarantees specifically in your settlement.
When You Need a Divorce Attorney for Debt Division
Debt division can significantly impact your financial future for years after divorce. An experienced divorce attorney can help you identify all marital and non-marital debts, understand which debts you may be responsible for under Illinois law, negotiate a fair allocation as part of overall property division, protect your assets from liability for your spouse’s debts, and draft settlement language that protects your interests with creditors.
Anderson Boback & Marshall has handled complex property division cases in Cook County, DuPage County, Lake County, and Will County for over 35 years. If you are facing divorce with significant debt, contact us for a consultation.
Frequently Asked Questions About Debt Division in Illinois Divorce
Is my spouse’s debt my responsibility in an Illinois divorce?
It depends on when the debt was incurred. Debt your spouse incurred during your marriage is generally marital debt that may be divided in divorce, even if only their name is on the account. Under 750 ILCS 5/503(a), marital property includes debts acquired during marriage. However, debt your spouse incurred before your marriage is typically non-marital under 750 ILCS 65/5. The Illinois Family Expense Act also makes both spouses liable for medical bills and family expenses regardless of whose name is on the account.
How do Illinois courts divide debt in divorce?
Illinois courts divide debt equitably, meaning fairly but not necessarily equally. Under 750 ILCS 5/503(d), courts consider each spouse’s income, earning capacity, financial obligations, and the overall property division. Courts balance assets with debts so neither spouse is left unable to pay. The purpose of the debt matters. Debt incurred for family benefit is more likely shared, while debt for individual purposes may be assigned to the spouse who incurred it.
Am I responsible for my spouse’s student loans in Illinois?
Usually not, even if the loans were taken during marriage. While technically marital debt under Illinois law, courts typically assign student loan debt to the spouse who obtained the education. However, this can vary. If you supported the household while your spouse attended school, or if you cosigned a refinance, courts may treat some portion as marital.
What happens to mortgage debt when we divorce in Illinois?
Mortgage debt typically follows the house. If one spouse keeps the home, they usually assume responsibility for the mortgage. However, your divorce decree does not remove the other spouse from the loan. Refinancing into one spouse’s name is necessary to fully separate the obligation. Until refinancing occurs, both spouses remain liable to the lender.
Can creditors come after me for debt my spouse was ordered to pay?
Yes. Creditors are not bound by your divorce decree. If your name is on a joint account and your ex-spouse stops paying, the creditor can pursue you and damage your credit. The divorce decree only binds you and your spouse, not third parties. This is why refinancing joint debts or paying them off before finalizing divorce is critical.
What is the difference between marital and non-marital debt in Illinois?
Marital debt is debt acquired by either spouse during the marriage. Under 750 ILCS 5/503(a), marital debt is divided equitably in divorce. Non-marital debt is debt acquired before the marriage or after separation. Under 750 ILCS 65/5, you are not liable for your spouse’s pre-marital debts. The classification determines whether the debt is subject to division or stays with one spouse.
What happens to debt incurred after we separate but before divorce is final?
This falls into a gray area. Illinois courts examine the circumstances. If one spouse controlled finances and the other needed debt for basic living expenses, that debt may still be marital. Debt for discretionary purposes or new relationships is more likely assigned to the spouse who incurred it. The closer to filing and the less related to family needs, the more likely it is treated as individual debt.
How is business debt handled in an Illinois divorce?
Business debt is typically considered alongside the business during valuation. If the business is marital property, the debt is usually allocated to the spouse who keeps the business. If you personally guaranteed business debt during the marriage, you may remain liable even if your spouse keeps the business. Address personal guarantees specifically in your divorce settlement.
Can I be held responsible for debt I did not know about?
Possibly. If your spouse incurred debt during your marriage without your knowledge, it may still be considered marital debt. However, if you can demonstrate the debt was hidden and used for non-marital purposes, the court may assign it entirely to your spouse as dissipation. Courts consider whether the debt benefited the family and whether one spouse concealed financial information.
