Skip to content Skip to sidebar Skip to footer

Can you use a loan to pay for your divorce?

Many people wonder how they are going to be able to afford a divorce. Some people are fortunate enough to have funds in savings, or even in their checking accounts. Others use credit cards, some borrow money from friends and family, the list goes on. But one popular question is, “can I use a loan to pay for my divorce?” In most scenarios, yes, but you should be aware of the caveats associated with such.

You can take out a persona loan to pay for your divorce. However, you should be cognizant of the fees/terms that come with said loan as you may end up paying more long-term than you planned.  Also, how the loan is ultimately paid off is also dependent upon your specific financial situation.  In some instances, you may be able to recoup those fees from your divorce and pay off the loan, or, in the alternative, that loan may remain your sole responsibility that you have to pay off on your own. Personal loans often have lower interest rate than credit cards, which is why it may be a good solution. However, you should also confirm that the repayment terms are something that will fit into your monthly budget after the divorce.

If you choose to borrow money from friends or family, rather than a lending institution, you should be sure to document such with the repayment terms. Otherwise, when you reflect it on your financial affidavit, it may raise questions as to whether the money was truly a loan, or a gift.

Many people also choose to borrow money from a home equity line of credit (HELOC) or a retirement account. While both of these options are permissible, and generally not in violation of the automatic orders, it is important to consider how such a loan would affect the marital estate. One thing to consider is whether it is one spouse, or both, who are borrowing against the marital estate like this.  The other question is then should the value of the loan be included in the division of the asset from which it was taken (i.e. the house or a retirement account). It is often helpful to consult with a financial planner, as well as an attorney, before solidifying your decision as to how to borrow money for your divorce.

Ever argue with a woman? Let Wolf & Shore Law Group go to work for you. We have guided countless people through the dissolution process, It may be a tough road, but it will be worth it on the other side. Click here, call us at 203.745.315, or email us at


Leave a comment


Skip to content