Marital Property and Debt in Divorce

We all know how fairy tales are supposed to end. You find the person of your dreams, get married, and live happily ever after. For some people, this really does happen, but for millions of others, this fantasy is cut short. So many marriages end in divorce these days, and along with the pain that comes with marital separation, other challenges arise too.

Money problems cause conflict in many relationships, but what happens when you get a divorce? How do you separate assets? How do you deal with marital debt?  When a couple is married, a number of loans may be taken out. Some debts are created by only one partner and others are taken out by both parties. Figuring out what you owe and what you don’t can be a daunting task.

When you start the divorce process, keep in mind that laws differ from state to state and each person’s circumstance is unique. Consult with an experienced divorce lawyer beforehand, so that he/she can give you legal advice. That way you can make the most informed decisions on matters concerning your case.

Community Property States

Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington and Wisconsin are the 9 community property states. In these states, whatever debt or property you bring into the marriage or receive individually through gifts and inheritances remain yours.

However, everything that you earn or acquire during marriage is considered community property, regardless of who earned it or whose name is on the title. You own half and your spouse owns half. Since both spouses “share” this income, each person is also held responsible for debts accrued during the marriage.

Of course, if you commingle marital and non-marital funds, it will very likely be considered community property by the court. Talk to a lawyer to verify what is considered separate property and marital property.

Common Law States

According to my friend at Konicek Law, all of the other states are common law states. They take the assets of both spouses, earned and inherited, and divide them based on what is equitable and fair. The court considers factors such as the financial health of each spouse, what the length of the marriage is, and what is fair before making its decisions. There aren’t set rules that determine who gets what and how much.

Separate Property: Separate property includes anything you owned prior to marriage, gifts and inheritance given to one spouse before or during marriage, and anything you earned after the date of separation. While your separate property belongs solely to you, in common law states, your spouse has the legal right to claim a portion of it in divorce.


Marital Property: Typically, marital property is described as any earnings and property acquired with those earnings during marriage. Debts are also considered marital property and are shared in divorce. For instance, if you and your ex bought a house together after you were married, you are both liable to pay for the mortgage.

Even if you made an agreement with your ex about who is responsible for the bills, if your name is on the title, the mortgage lender will still hold you liable. A divorce agreement is not binding on the lender. Speak to your lawyer to make sure that a division of the property and refinancing of a loan is enforceable with sanctions against the person that does not cooperate.

Remember, the definition of marital property can vary from state to state. Division of property and debts becomes more complex if marital property and separate property have been mingled or if property has been acquired by the couple using both marital funds and separate funds. Consult with a divorce lawyer to find out what you are liable for and what actions you may take.



Divorce, no matter how contentious or amiable, always has its challenges. The collapse of a marriage is stressful enough, but it often comes with emotional, mental, and financial baggage too.

If divorce has wrecked your credit, and you are seeking debtrelief from your financial woes, it is best to start fresh. After figuring out all the details of the divorce with your lawyer, you can work with a reputable debt relief company that can help you get back on track. The sooner you get out of debt, the sooner you can move on with your life and start building towards a better financial future.


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