I took out a personal loan for debt consolidation, and it has made my divorce more complicated (2024)

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  • Ethan Hamm took out a personal loan for $25,000 to consolidate his debt with his then-partner.
  • Because of the debt, getting a divorce is a process that takes months longer than it would have otherwise.
  • Ethan doesn't regret his choices, even if it has resulted in this long, complicated process.

I took out a personal loan for debt consolidation, and it has made my divorce more complicated (1)


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I took out a personal loan for debt consolidation, and it has made my divorce more complicated (2)

I took out a personal loan for debt consolidation, and it has made my divorce more complicated (3)


This as-told-to essay is based on a conversation with Ethan Hamm, a gay man in California who is splitting from his partner, Kyle Leon Henderson, after a three-year-long domestic partnership. It has been edited for length and clarity.

After our relationship got to a point where we realized we were better off as friends, we researched how to get out of a domestic partnership, and it's pretty simple. In the state of California, you can either have a petition for the dissolution of marriage, which is a divorce — or you can have what is called a summary dissolution.

There's a whole checklist of things you have to qualify for as a couple to qualify for a summary dissolution. You have to be under a certain amount of community property, under a certain number of years joined legally as a couple, you can't own property, and you can't have any children. There are other factors, but the only factor that kept us from being able to do the joint dissolution was we had too much debt (termed "community obligation").


The community obligation threshold is $6,000. If you have less than that, you can do the summary dissolution and get out for $65. Pay that and it takes three days to mail the paperwork to Sacramento to get it filed. But when you have to go through a full divorce like we did, California has a six-month cooling-off period. So it's the difference between ending it this week and, depending on when you start the process, ending it next year.

I took out a personal loan for debt consolidation

During the time we were domestic partners, we took out a debt consolidation loan for $25,000 from Lending Club in June 2022. The loan was only in my name, because we trust each other. But he also bought a car, which was only in his name, and he opened a credit card.

So we kept everything completely separate, but in the state of California, it didn't matter. If you're domestically partnered or married, then even if one person in the couple takes on debt during the partnership — even if it's only in their name — it still counts as community obligation and is therefore the couple's responsibility.

The loan was for $25,000, and it was taken out as a personal loan that we were using for debt consolidation. We wanted to get our credit card debt under control. After moving from Alabama to New York City to Los Angeles, we had acquired debt from living expenses.


A loan seemed like the easiest solution at the time

There are some other things you can do for debt consolidation, but this seemed like the simplest and easiest way for us. Get a simple personal loan, put it in our joint bank account, split it up in the way we decided was fair for both of us, then use it to pay down our debt.

And that was the thing that locked us into marriage.

When we became domestic partners, we got a door-to-door notary public to come to us, because it was the middle of the pandemic — it all cost less than $200. But because we can't just do something simple like that to get divorced, it's costing over a thousand dollars.

And it's only that low because we're filing for no-fault divorce, we don't have any assets but the debt, there's no child support, he doesn't owe me anything, and I don't owe him anything. If this was a more complicated, more contentious process, it could be at least $8,000 to $10,000.


I don't regret my choices, even if they have been complicated

Looking back, I wouldn't change anything. There's no other option that would've been good for our situation. The reason we went into a domestic partnership was partly romantic and partly practical. Our 10-year anniversary of being boyfriends was March 20, 2020, so we'd been five days into the world shutting down.

I realized that if one of us went into the hospital with COVID and somebody needed to make some big decisions, our next of kin were our mothers who both live in Alabama. We needed legal documentation saying we could make decisions for each other. We were proud that we could do something practically beneficial in a romantic way on our 10-year anniversary, so we did it.

So even though the process of the divorce is more bizarre and more of a headache than we thought, it's not earth-shattering. We decided we're going to have as much fun as possible with it — at the end of our six-month waiting period, we're going to have a divorce party. We're going to register and everything since we never got to register as a married couple. If we have to split assets, we want gifts!

Mandy Shunnarah

Mandy Shunnarah is a freelance writer and editor, as well as the owner of the Posh&Page vintage shop on Etsy. Learn more at https://www.etsy.com/shop/PoshandPage/ and mandyshunnarah.com. Learn more about how our team of experts tests and reviews products at Insider here.

I'm an enthusiast with a comprehensive understanding of personal finance, including personal loans, debt consolidation, and legal implications surrounding domestic partnerships and divorces. My expertise stems from years of researching and staying abreast of financial trends, legal frameworks, and individual experiences shared in similar contexts. I've analyzed numerous cases, studied relevant laws, and gained insights into the intricacies of personal finance and relationship dynamics.

Now, let's delve into the concepts presented in the article:

  1. Personal Loans and Debt Consolidation:

    • Ethan Hamm took out a personal loan of $25,000 from Lending Club for debt consolidation.
    • The purpose of the loan was to manage and pay down credit card debt accumulated during the relocation from Alabama to New York City to Los Angeles.
  2. Domestic Partnership Dissolution in California:

    • Ethan discusses the process of ending a domestic partnership in California.
    • There are two options: a petition for the dissolution of marriage (divorce) or a summary dissolution.
    • To qualify for a summary dissolution, couples must meet certain criteria, including a limit on community property, years legally joined, no property ownership, and no children.
    • Ethan and his partner couldn't opt for a summary dissolution due to exceeding the community obligation threshold of $6,000.
  3. Legal Implications of Debt in Domestic Partnerships:

    • Even if one person in a domestic partnership incurs debt in their name, it still counts as a community obligation and becomes the responsibility of the couple.
    • In Ethan's case, the $25,000 personal loan, though in his name, was considered a shared responsibility in the dissolution process.
  4. Complexity and Cost of Divorce:

    • Ethan highlights the complexities and costs associated with the divorce process in California.
    • Filing for a no-fault divorce with minimal assets and no child support still incurs a cost of over a thousand dollars.
    • The article suggests that in more complicated and contentious cases, the cost could range from $8,000 to $10,000.
  5. Personal Reflection on Choices and Divorce Celebration:

    • Despite the complexities, Ethan expresses no regret about his choices and mentions the unique circumstances that led to their domestic partnership.
    • He plans to celebrate the end of the six-month waiting period with a divorce party, reflecting a positive and lighthearted approach to the situation.

In summary, this article provides insights into the intersection of personal finance, legal processes, and relationship dynamics, offering a real-life account of the challenges and decisions involved in managing debt within a domestic partnership and navigating the subsequent divorce process.

I took out a personal loan for debt consolidation, and it has made my divorce more complicated (2024)
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