Clarity for financial separation

Divorce Debt Toronto

Debt doesn’t disappear when a relationship ends. We help you understand who is responsible for shared loans, credit card balances, and other financial obligations—before and after your divorce is finalized.

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Dealing with debt during and after divorce

Debt Overview

How debts are divided at separation

Just like property, debts must be divided. We explain how family debt, credit cards, and joint loans are handled—and what happens if one spouse racks up debt before or after separation.

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Equalization of Debt

Balancing property and liabilities fairly

Debt is factored into the division of property. We work to ensure debts are fairly assigned and offset against assets, so the final outcome is equitable under Ontario law.

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Joint Debt Issues

How to deal with shared liabilities

If you co-signed or shared accounts, you’re still liable even after separation. We help you address these risks through settlements, refinancing, or agreements that limit exposure.

Planning for Stability

Protecting your financial future after divorce

Managing debt correctly during separation protects your credit, savings, and stability. We advise on steps you can take now to avoid future problems tied to joint obligations.

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Debt incurred by one spouse

Generally, the spouse who incurred debt during the marriage is solely responsible for paying it
back. For example, if one spouse took out a car loan in his name, the other spouse will generally
not be liable for repayment of same.

Joint debt

Generally, both spouses are equally responsible for paying the full amount of joint debt. For
example, if both spouses opened a joint line of credit, they will both be responsible for the full
amount owed. Creditors can then pursue both spouses for the repayment of same. Accordingly,
if one spouse does not pay his share of the joint debt, the other spouse may be liable for the
entire amount.

Often, separation agreements stipulate which spouse will pay which debt(s). However, these
agreements are not binding on third party creditors. Thus, one spouse might still be liable for
the other spouse’s debt, notwithstanding a clause in the separation agreement to the contrary.

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– Barry Nussbaum, JD, MBA, Senior Lawyer