Dividing Debts in the UK During Divorce: What You Need to Know & How MLS Legal Services Can Help

Divorce and separation can be some of the most emotionally challenging times in a person’s life, but beyond the emotional toll, the financial side of ending a relationship is just as critical. While much attention is paid to dividing assets like property, pensions, and savings, dividing debts can be equally complex and often, just as contentious.

If you’re going through a divorce or separation in the UK, it’s essential to understand how debts are handled legally, what your rights and responsibilities are, and how a solicitor can support you through the process. At MLS Legal Services, we help individuals navigate financial disputes during separation and secure a fair outcome.

What Types of Debt Are Considered in Divorce?

When you separate or divorce, all financial matters between you and your spouse or civil partner must be resolved. Debts are a key part of this process and generally fall into two main categories:

1. Joint Debts

These include:

• Joint mortgages

• Joint bank loans

• Overdrafts on joint accounts

• Credit cards in both names

Because these debts are in both your names, both parties are legally liable for the full amount, regardless of any informal agreement between the two of you.

2. Individual Debts

Debts taken out in one person’s name (such as personal loans or credit cards) are usually the sole responsibility of that person. However, in family court proceedings, these debts may still be considered, particularly if they were used for family benefit (e.g., paying for household bills, childcare, or joint purchases).

How Are Debts Divided in Divorce in the UK?

There’s no fixed formula for dividing debts in divorce. Courts in England and Wales (and similarly in Scotland and Northern Ireland) aim for a fair and reasonable division of all finances assets andliabilities.

The key factors the court considers include:

• The needs of each party, especially where children are involved

• The income, earning capacity, property, and financial resources of both parties

• The contributions made by each party during the relationship

• The standard of living enjoyed before the breakdown of the marriage

Example:

If one partner took out a loan in their sole name but used it to pay for a family car, the court may view it as a joint responsibility.

Common Challenges When Dividing Debt

One Party Stops Paying

It’s not uncommon for one partner to stop contributing to a joint loan or mortgage during separation. Unfortunately, lenders don’t care who pays they’ll pursue both parties if payments are missed, damaging both credit scores.

Hidden Debts

In some cases, one party may try to conceal debts or run up new ones before the divorce is final. A full financial disclosure is required by the court, but it can be difficult to uncover everything without legal help.

Guarantor or Family Loans

If family members have co-signed a loan, or one party owes money to relatives, these debts can add layers of legal complexity.

How MLS Legal Services Can Help

At MLS Legal Services, we understand that dividing debts isn’t just about numbers, it’s about your future financial stability. Here’s how we support our clients through this process:

1. Thorough Financial Review

We’ll work with you to gather full disclosure from both parties, including personal debts, joint accounts, and hidden liabilities. Transparency is key to reaching a fair settlement.

2. Negotiating Fair Settlements

Whether through mediation, solicitor correspondence, or court proceedings, we help you argue your case for a just division, especially if the debt was incurred recklessly or unfairly by the other party.

3. Protecting Your Credit & Rights

We can help negotiate the removal of your name from joint debts (where possible) or help you protect your credit rating. In more complex cases, we’ll advise on legal remedies, including applying for financial orders.

4. Drafting Clean Break Agreements

Once debts and assets are resolved, we help draft legally binding consent orders to ensure there are no future claims from your ex-spouse.

You Don’t Have to Go Through This Alone

Dividing debts during a divorce can feel overwhelming, especially when emotions run high and financial security is at stake. But with the right legal support, you can make informed decisions, protect your future, and walk away with peace of mind.

At MLS Legal Services, we specialise in family law and offer compassionate, clear, and strategic legal advice tailored to your situation. Whether your case is straightforward or complex, our experienced team is here to fight for the outcome you deserve.