Divorce proceedings are emotional and stressful for many reasons. One of the biggest stress factors during a divorce proceeding is debt. In California, when you get divorced, your debt doesn’t just simply disappear. Regardless of whether you are married, you will still be responsible for at least a portion of your debt. The important thing is to determine what part of that debt you will actually have to pay back after getting a divorce.
Debt In a Community Property State
California is a considered a community property state. This means that both you and your spouse will be responsible for any debt that you accumulate while you are married. If your marriage ends in a divorce, both you and your spouse will have to repay all the debt you racked up while you were together. For example, if your spouse ran up thousands of dollars secretly on a credit card, both of your will be responsible for the debt even though only one spouse created the debt.
Dividing Debt In a California Divorce
Dividing debt is very similar to dividing assets in a California divorce. Unless you entered into an agreement as to the division of debts, it will be divided equally between both you and your spouse in a divorce. Although each debt (and asset) may not be divided in half, the goal is for each spouse to end up with an equal division.
The exception to the equal division rule comes about when the value of the community debts exceeds the value of the community assets. In these cases, California law allows family courts to unequally divide the debt by assigning the excess debts to the spouse who is more financially capable of paying them back.
Community Debt v. Separate Debt
The first important task in dividing debt is for your Central Valley divorce attorney to determine the debt’s character. In other words, your attorney will need to figure out whether the debt is a community or separate debt.
- Community Debt: A community debt is incurred during marriage, even if incurred by only one of the spouses.
- Separate Debt: A separate debt is incurred before marriage or after separation and only belongs to the spouse that incurred them.
Characterizing debts can be a complicated area of the law. As such, it is a good idea to consult with an experienced Central Valley family law attorney for more information and advice.
Call an Experienced Central Valley Divorce Attorney
If you are going through a divorce or planning to file for divorce, it is important that you have a knowledgeable attorney fighting for your rights. For more information or to schedule a complimentary consultation with a Central Valley divorce attorney, please call Gurjit Srai (209) 323-5558 or (559) 449-1447, or complete our online form.