How Do Courts Divide Debt in a Divorce?

In a divorce, it’s easy to focus on the property you have. You are reasonably concerned about what happens to your house, car, game console, and so on.

With all this worry, it’s easy to forget that there is probably debt within the marriage as well. Even though debt is a net negative, it is technically part of the marital assets, and it must be somehow split in the divorce.

Courts split debt according to the state’s property division system.

Splitting Debt in an Equitable Division System

Most U.S. states divide property equitably in a divorce. Essentially, a court attempts to give property to the most deserving individual. If one spouse was the main contributor to or user of the property, they can generally keep it.

For example, think of the family dog. The animal may have attached itself to one spouse. It spends all their time with this person, follows them around, and shows them the most love. Concurrently, this spouse takes the most responsibility for the dog. They feed it, bathe it, walk it, and so on. There is no question that the dog is “theirs.” In this case, they will probably keep the dog after the divorce.

The same principle applies to loans and credit. Debt goes to the most “deserving” of the spouses. If one spouse is mainly responsible for accruing the debt, they could be forced to take it all. When debt is uncomplicated, each spouse could walk away with exactly the amount of debt they created in the marriage.

Splitting Debt in a Community Property Division System

Only nine states still use the community property system. Many consider it the more antiquated of the two models. California uses community property rules in a divorce.

Essentially, there are two types of property in a divorce: marital and separate. Separate property belongs to just one person, and marital property belongs to both spouses. Generally, marital property is anything either spouse purchased while married.

Community property states attempt to leave each spouse with 50% of the marital assets. Therefore, debt should be divided equally among divorcees.

Factors That Can Affect Debt Division in a Divorce

Regardless of your state’s property division model, the court can allow outside circumstances to affect its debt decisions.

For instance, one spouse may be accused of wasteful dissipation, an unscrupulous practice. Wasteful dissipation happens when one spouse intentionally wastes money, attempting to leave the other with little after the divorce. If you can prove that your spouse engaged in this behavior, you may be able to take on less of the marital debt.

Evidence of abuse in the marriage can affect debt division as well. If a family court believes one spouse was abusive, it can make decisions the way a civil court does. It can order a greater degree of spousal support and property to the injured party, compensating them for their suffering. The court could also give the abused spouse less of the overall marital debt.

If you’re concerned about debt in your divorce, contact our firm for a free consultation. We may be able to help. Our number is (805) 633-4999, and we have an online contact form, too.

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