In community property states, it is essential to understand the community property states debt rules. A community propery state is a state wherein all property that is acquired during the marriage is considered to be marital property and thus shared. In other words, each spouse is entitled to one half of all property, regardless of who actually bought or paid for it.
In community property states, marital debt is also considered to be joint debt unless there is clear evidence that one of the two spouses acquired the debt separately. In other words:
- All marital debt, or debt used to purchase marital property, is considered to be split 50-50
- Debt that spouses brought into the marriage is generally considered to be the responsibility of the spouse who brought that particular debt into the relationship
It is also important to note that a court agreement will not override any agreement with the creditor. In other words, if you and your spouse co-signed for a mastercard and then you decide during the divorce that only one of the two of you will be responsible for that particular debt, mastercard won't necessarily respect that agreement. If both of your names are on the obligation to the credit card company, then mastercard is able to come after both of you and keep the debt on both of your credit reports. For this reason, it is advised to refinance any debt into the name of the person responsible for paying it whenever it is possible to do this as part of the divorce.
It is also permissible, even in community property states, for you and your spouse to come to your own out-of-court agreement regarding what you will do as far as property and debts are concerned. If both of you are able to agree on a settlement agreement and present it to the divorce court as part of an uncontested divorce, decisions that you might have made regarding asset division and property division will be respected by the court unless there was evidence of coercion or something irregular in the creation of the agreement.
Getting Help
To ensure that your legal rights are fully protected during the divorce process and that you don't get stuck with an unfair amount of the debt burden, it is imperative you consult with an experienced lawyer as soon as possible during the divorce proceedings. Your attorney can assist you in arguing before the court or coming to a settlement agreement that is fair.
