Debt allocation is the division of responsibility for debts between spouses in an Arizona divorce decree or settlement agreement. Each debt in the marital estate must be assigned to one party or the other with provisions for what happens if the assigned party fails to pay.

Creditors are not parties to the divorce and are not bound by the decree. A lender who holds a joint debt can pursue both parties regardless of what the decree says. Indemnification provisions in the decree protect the non-responsible spouse.

Refinancing deadlines matter. If one spouse is ordered to refinance joint debt into their name alone the decree must specify a deadline and what happens if the refinancing cannot be completed.