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How are Debts Divided in a Divorce?

How are Debts Divided in a Divorce?

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If you’re going through a divorce, it’s natural to wonder how assets will be divided: but many people forget about the debts. Divorce lawyers in Houston, TX can tell you that while dividing assets is tricky, dividing debt can be even harder.

Ask Divorce Lawyers in Houston, TX: How Is Debt Divided?

Understanding Community Property

Texas operates under a community property system. Simply put, most property – and debts – acquired during the marriage are considered “community” property. This means they belong to both spouses equally regardless of who earned the money or whose name is on the loan.

Separate vs. Community Debts

Not all debts get lumped together, however. Separate debts are debts incurred by one spouse before the marriage or during the marriage with funds considered separate property (e.g., inheritances). Separate debts generally remain the responsibility of the spouse who incurred them.

Community debts are those acquired during the marriage by either spouse or by both spouses jointly. Examples include credit card debt, car loans, and mortgages on the family home. Community debts are divided according to Texas’ “just and right” division rules.

“Just and Right”

The court has the discretion to determine a fair division based on several factors:

  1. Length of the marriage: Longer marriages may result in a more equal split.
  2. Earning capacity of each spouse: A spouse with significantly higher income might be responsible for a larger portion of the debt.
  3. Debt characterization: How the debt was incurred can influence the division. For example, excessive gambling debts by one spouse might not be considered a sharedresponsibility, especially if the other spouse can prove they didn’t know about the gambling.
  4. Separate property contributions: If one spouse brought substantial separate property assets into the marriage, it could affect the debt division.
  5. Child custody arrangements: If one spouse has primary custody, they might receive a larger portion of marital assets, potentially offsetting a larger debt share, to ensure they can support the child.


Debt Division Options

Equal division is the simplest solution if both spouses have similar financial situations and debt loads. Proportional division makes the decision based on each spouse’s income or earning capacity. Specific debt allocation allows each spouse to assume responsibility for specific debts tied to certain assets they receive (e.g., the car loan stays with the car).

Some people going through divorce are able to agree on a buyout, where one spouse agrees to take on a larger portion of the debt in exchange for a greater share of marital assets.

Reaching an Agreement

The best approach often involves working out an agreement with your spouse through negotiation or mediation. Your attorney will be very important at this stage, protecting your interests and ensuring you’re not saddled with more debt than you should be.

If an agreement can’t be reached, the court will make the final decision on debt division based on the factors mentioned earlier. For more information, click here.

Every divorce is unique, and consulting with a qualified family law attorney is crucial to getting through yours with the best outcome.


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