Dividing property during divorce means looking at both what you own and what you owe. Credit cards, mortgages, and business loans can affect your financial future just as much as the house or retirement accounts.

In South Carolina, marital assets and debts are divided equitably—but that does not automatically mean splitting everything 50/50.

What makes a debt marital?

South Carolina’s equitable distribution law requires courts to consider existing debts incurred during the marriage when dividing the marital estate. The court also considers factors such as the length of the marriage, each spouse’s contributions, and their financial circumstances. Read more in Settlyd’s guide to equitable division of property in South Carolina.

A debt can be marital even if only one spouse signed for it. South Carolina courts focus on whether the debt was incurred for the couple’s joint benefit.

Generally, debt incurred before marital litigation begins is presumed marital. The spouse arguing otherwise must present evidence to overcome that presumption. Simply saying, “I didn’t know about it,” may not be enough.

What if your spouse’s business fails?

Suppose your spouse starts a business during the marriage, borrows money, and the business eventually closes.

The business’s failure does not, by itself, determine who should pay its debts. Applying the joint-benefit rule requires examining the facts:

• Was the business intended to support the household?
• Where did the borrowed money actually go?
• When was the debt incurred?
• Do loan documents, bank statements, and business records support either spouse’s position?

Depending on the evidence, the debt may be classified as marital or nonmarital. If marital, its allocation becomes part of the overall equitable division. Neither an automatic half share nor complete freedom from responsibility should be assumed.

Will the divorce order protect you from creditors?

A divorce order assigning a joint debt to your spouse generally does not release you from your agreement with the lender. If you remain a borrower, the creditor may still seek payment from you. Discuss payoff, refinancing, or a lender-approved release when planning your settlement.

Start with clear financial information

Gather account statements, loan agreements, balances, and records showing how borrowed money was used. Then consider assets and debts together when evaluating settlement proposals.

Settlyd’s side-by-side worksheets help you and your attorney compare financial alternatives. Our five-step mediation preparation guide explains how organized financial information supports settlement discussions.

Clear records can help turn an argument about blame into a practical discussion about a fair resolution—and preserve resources for life after divorce.