Debts and divorce: Know what you need to do to protect yourself
It can be hard to admit that a marriage is in trouble. It may be even more difficult to contemplate taking the first steps toward a divorce. But, the reality is that many marriages simply will not work out, no matter how much the couple tries to find common ground. When the couple experiences these challenges, it can be impossible to focus on the positive aspects of their marriage. The emotions between the parties lead to resentment, and arguments may become more frequent.
Once divorce becomes a real option, it is important that the spouses are aware of some of the issues that they will need to focus on throughout the process. As many individuals have never encountered these issues before, it is not uncommon for some to make mistakes when trying to find agreements on outstanding issues. They may wish to get things over as soon as possible, which can lead to serious problems when they are trying to start over.
One essential part of any divorce will be the division of marital property. In California, community property rules apply. This means that everything that the couple acquired during the marriage is considered to be marital property. This property will be subject to a 50-50 split between both of the spouses.
The division of the debts will be included in this process as well, and it is important that each spouse understands the ramifications before making any agreements. Some couples may have accumulated significant credit card debt during the marriage, which means that each spouse could potentially be held responsible for the other's debt if it goes unpaid.
When a person knows that he or she will be filing for divorce, it might be a wise idea to freeze any of these joint credit cards. This can stop one of the spouses from incurring significant debt during the process, which can make the divorce much more difficult to resolve.
The court may also play a role addressing the issues that arise because of credit card debt. The property division agreement may require the parties to stay current with the payments, and refusing to honor these orders can result in serious penalties for those individuals.
No matter how these debts are handled, it is essential that each spouse is aware of the complications that can arise if they are not addressed during the divorce process. Speak to an experienced family law attorney about what you need to do to protect yourself during this difficult time.
You may want to help facilitate an agreement with your soon-to-be-ex-spouse and this could come back to cause you significant financial distress at a period where money may already be in short supply. Failing to carefully consider your debts at this time could lead you to need to file for bankruptcy after your divorce is final.