What if my spouse fails to pay the debt he or she was supposed to pay?

Sometimes, when negotiating a property division, the only reasonable way to divide the debt is for one party to promise to pay debt and to pay the other party a sum of money.  In a Final Decree, this promise to pay is set out in a judgment to equalize the property division.

So, if the party who is obligated to pay the debt fails to do so, then the other spouse can abstract the judgment and record it in the county property records.  This allows the party to be able to put a lien on or take and sell certain property, if any is available, and the effect of doing this is that the judgment will be reflected on the debtor’s credit reports so that he or she will have difficulty borrowing money in the future.

However, a judgment is not foolproof, and a party should not rely on it as a sole means of indemnity.  I caution my clients to consider the fact that if the creditor can’t get them to pay the debt, then how likely is it that my client will get them to pay?  In other words, if the debtor doesn’t have any significant assets that can be sold or liened on, then there is not much that can be done to force repayment of the debt.  Moreover, if the debtor files for bankruptcy, chances are that the judgment will be wiped out.  Often, the only remaining alternative is some form of alimony or lump sum payment.  Unfortunately, (and this is the part no one wants to hear) if neither of those options is available, the sad truth is that the only remaining alternative may be to just cut your losses, take the hit, and try to rebuild your life.