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My Parent(s) Made a Loan to Me and My Spouse During Our Marriage. What Happens to That Debt After We Divorce in Florida?

Several experts recommend against doing business with family. A few years ago, CBS News published an article about “5 Dangers of Doing Business With Family and Friends.” Many times, though, the pull of familial love and the desire to help out a child, sibling or parent may overcome concern about those dangers.

So, what happens if you receive money from your parent while you’re married and then you and your spouse divorce? It depends of the specific facts, but many times, if that money is a loan, then it is a marital debt. If your spouse is trying to put you on the hook for paying 100% of the loan debt you received from your mom or dad, don’t give up. Fight back with a skilled and knowledgeable Fort Lauderdale divorce attorney.

That type of scenario actually happened to one Florida Panhandle man in his divorce case. During the marriage, the couple received $125,000 from the husband’s mother. The couple received that money after the wife, a real estate professional, discovered a condo she deemed to be a good investment and suggested that she, her husband and her mother-in-law go in on the condo together. The husband’s mother balked at buying an ownership stake in the condo, but instead allegedly decided to loan the couple $125,000 so that they could make the purchase.

After the couple began divorce proceedings, the husband asserted that the sum was a loan from mom while the wife contended that her mother-in-law’s $125,000 was actually a gift to the couple. At the court hearing, the husband had many witnesses to support his position. He testified the money was a loan, as did his mother and his brother. The trial judge agreed that the money was a loan, but decided that the obligation for repaying that loan would fall 100% on the husband.

An unequal distribution requires specific justification from the court

This type of resolution, of course, represents an unequal distribution. In Florida, a trial judge can order an unequal distribution only if he/she makes “specific findings” of fact that justify deviating from the default (which is a 50-50 split of assets and debts.)

This wife’s argument was that an unequal distribution was appropriate because she had provided adequate proof at the hearing that the husband was involved in “deceitful scheme” or other misconduct in relation to the money and its status as a loan (as opposed to a gift.) A spouse’s concoction of a deceitful scheme, fraud or other misconduct can be a valid basis for a trial judge ordering an unequal distribution of assets or debts. As noted in the preceding paragraph, however, the law requires that the trial judge make specific determinations finding that the one spouse engaged in deceit, fraud or other misconduct before an unequal distribution of marital assets and debts can be ordered. No finding of misconduct means no misconduct-based unequal distribution, according to Florida law, and there were no such findings in this case.

Are you someone going through divorce and facing a spouse who is trying to make you 100% responsible for paying one or more marital debts? Take action to get the legal help you need. Contact the experienced South Florida family law attorneys at Sandy T. Fox, P.A. to protect yourself during the equitable distribution process and help you determine what is rightfully yours. Contact our attorneys online or by calling (800) 596-0579 to schedule your confidential consultation.

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