How to Divide Debt in a California Divorce

How to Divide Debt in a California Divorce

Deciding to obtain a divorce can be hard enough, but it can be even more complicated when finances come into the equation. People are usually concerned with how they will divide their property and assets; they forget to take into account debt. Understanding what compromises debt during a marriage will help you understand how it is divided during a divorce in San Bernardino.

California is a “community property” state, meaning debt accrued during a marriage must be divided equally between both spouses, regardless of who incurred it. While courts may not concretely split the debt in half, they will make sure that the amount owed and the assets gained are equally shared between the splitting husband and wife. The exception to this practice is if the couple has a pre-nuptial agreement articulating how debt will be divided in case of a divorce.

The court examines the value of both the couple’s assets and debt. If the value of the debt exceeds the value of assets, the court has the right to unequally assign debt division. In most cases, courts will assign the excess debt to the party that is better financially situated.

The two forms of debt courts consider are:

  • Community Debt – A couple generates this debt during their marriage through their separation debt. Both parties are responsible for the money owed.
  • Separate Debt – This debt is accrued either before or after a marriage. Only the person incurring the amount must pay it off.

The date of separation determines when a couple’s debt stops being communal. California law dictates two components for defining the date of separation. They include:

  1. The day that a couple physically separates. One spouse must move out of the shared home. In some cases, courts may consider the moment when a couple starts sleeping in separate rooms.
  2. One spouse must have an intent to end the marriage.

At Family Law Advocacy Group, we want to help you through your divorce. We recommend filling a schedule of assets and debts to list the current debts you and your spouse owe. Our San Bernardino divorce Attorney can help you seek fair division of debt during your marriage dissolution. Call our office today at (909) 344-5704 to schedule a free consultation!


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