When getting divorced, you may anticipate splitting property, assets, wealth, and child custody. However, you will also need to consider how much debt you need to divide. This is something that many forget about, and they end up shocked that they are responsible for debts their spouse may have incurred. However, a Los Angeles divorce attorney can help you ensure the process of dividing debt is as fair as possible during the dissolution of your marriage.
What Should I Know About Dividing Debt?
One of the most essential things to understand about dividing debt during a divorce in California is that it is a community property state, meaning assets and debts and assets obtained during the divorce belong to both spouses equally. While this is great as it virtually guarantees 50% of the shared assets go to each spouse, it also means 50% of the shared debt will be awarded to each spouse.
Examples of shared debt include credit card debt when used to purchase items for children or mortgages. Because this debt benefits both spouses, it is considered community property.
However, there are some instances where debt is considered separate for spouses. Any debt that occurred before the marriage is considered individual. Similarly, debt acquired during the marriage in solely one spouse’s name, used only for that spouse (such as student loans), is not community property. However, you may still want to sign a prenuptial agreement to ensure you are not responsible for any debts your spouse incurs during the marriage.
What if We Have More Debt Than Assets?
If you and your spouse have accumulated more debt than your assets are valued at, the process may not be as equal. Because it can be more challenging to pay off excess debts, the courts may assign more payments to one spouse. They will evaluate both spouses’ financial circumstances, including their profession and income, to assign the extra debt to the spouse in a more secure financial situation.
What If My Spouse Isn’t Paying Their Share?
When the debt is divided, you may think you don’t have to pay attention to the debt your spouse was court-ordered to pay. However, if it is a shared debt, meaning your name is on the contract, it is essential that you are aware of the payments. If your spouse stops paying, it can hurt your credit score.
If you’ve found that your spouse has failed to make their mandated payment, you will need to return to court. You can hold them in contempt, and they will be responsible for making the necessary payments.
However, you should avoid navigating this process alone. The Zitser Family Law Group can provide the necessary support, advice, and guidance to help you get through your divorce. We will also fight to ensure you receive the best possible outcome for your situation.
