Who Will Pay the Credit Card Debt After Divorce?

May 10, 2023
By Alternative Divorce Solutions

California’s Equitable Distribution Standard

If you are getting divorced in California, your property, assets, and debts will be divided based on the state’s equitable distribution standard, which exists to divide marital property as fairly as possible. The term “equitable distribution” may appear to mean that all of a couple’s shared debts and assets will be split down the middle and that each party will receive 50% of the total. However, this is not necessarily the case, and one spouse may still leave the marriage with a larger share of their debt or property.

In the state of California, any debts, property, income, etc. that you and your spouse accumulated during your marriage may be subject to equal (or near-equal) division. This can include real estate, automobiles, investments, retirement savings, credit card debts, and more. However, it excludes everything acquired before marriage or after the date of your separation.

Dividing Credit Card Debt & Other Financial Obligations During Divorce

Your shared debt will be factored in when considering the overall value of your shared estate, and a judge, mediator, or arbiter will decide how to divide debt most fairly.

Unfortunately for some spouses, creditors are typically unconcerned with who racked up what percentage of debt incurred by using credit cards, and both spouses will be held responsible for what the court refers to as “community debt.” Except in circumstances involving deliberate marital waste or a spouse taking on debt individually or secretly during marriage, a judge is unlikely to force one spouse to repay the full sum of a divorcing couple’s credit card debt.

If you are given full ownership of an asset which involves the continued repayment of loans, such as a home or car, you can expect to assume full responsibility for the debt.

Divorce Mediation Service in Orange County

Many splitting spouses worry that they will be left with an unfair amount of debt after their divorce is finalized. Even if you aren’t yet worried about the division of property, assets, and debts, having a skilled attorney on your side to help you and your spouse reach a desirable solution is essential. Getting a fair settlement is essential to your ability to start fresh after your divorce, and our team here at Alternative Divorce Solutions can help you make it happen.

Call 949-368-2121 today to speak to a member of our team. You can also send us a message to schedule your consultation with an Orange County divorce mediation lawyer.

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