Splitting up property is a priority in most divorces. Couples must reach agreements regarding their assets and debts. If they do not have a prior arrangement in place, possibly due to signing a prenuptial agreement, then they must negotiate with one another before filing for divorce or wait for a judge to apply state statutes to the marital estate.
Spouses usually share their interest in valuable assets acquired during marriage and responsibility for any debts accrued during the marriage. Sometimes, one spouse may ask that the courts exclude specific debts from the marital estate.
When might judges agree that a debt is not a marital obligation?
When the debt predates the marriage
Debts due grow over time. If people do not pay down the principal balance on credit card debts or other financial obligations, what they owe can increase steadily over many years. Debts taken on before the marriage are generally not divisible, even if they accrued penalties and interest during the marriage.
Debts that are actually dissipation
While spouses share responsibility for most legitimate marital debts, some debts are malicious or destructive in nature. They may constitute dissipation, which is the inappropriate destruction or waste of marital property.
Hidden debts accumulated during the marriage for a purpose that damaged the relationship could constitute dissipation. For example, if one spouse hid their gambling problem or drug abuse, they may have accrued secret debts funding those habits. Credit card balances and other debts associated with an extramarital affair could also constitute dissipation.
Reviewing financial records can help spouses identify debts that they may not need to share when they divorce. An attorney’s guidance can help people secure fair property and debt division terms.