If you want to know the answer to the question, “How are assets and debt divided in a divorce?” then you first need to determine what your state’s stance is on community property and equitable distribution. Only then can you know what to expect to happen to your assets post-marriage.
Texas is one of nine community property states in the USA. This means that all property, assets, and debt acquired during the marriage will undergo a fair and just division. Which usually looks like a 50/50 split. But what property, assets, and debt live outside the 50/50 split in a divorce, and is this always the case 100% of the time? Let’s take a look.
Are assets always split 50/50 in a divorce in Texas?
The first key to being able to answer the question How are assets and debt divided in divorce is to gain an understanding of community property.
If you reside in a community property state like Texas and you’re seeking a divorce, then all of the property acquired during the marriage is subject to a fair and just division. The more common practice is splitting the assets 50/50, because Texas courts try to be as fair as possible. This property includes everything from homes and cars to pets and clothing (yes, your husband may even have a right to your yoga pants). For detailed information on communal property, read our article: In a Divorce, Who Gets the House in Texas?
However, not all property acquired during a marriage in Texas is split 50/50. If the husband or wife has separate property, then this will exist outside the 50/50 split. Here’s what property this could refer to:
- Any property gained before the marriage is considered separate and will not be split 50/50 during a divorce.
- Sometimes this includes benefits that arise from separate property.
- Sometimes this includes benefits that arise from separate property.
- Any property given to either spouse as a gift or as inheritance is considered separate and will not be split 50/50 during a divorce.
- This property money received in a lawsuit (unless a percentage of that money is considered lost income; that would technically be considered money earned/acquired during the marriage).
If you believe that you have property that is separate from your spouse, then you’ll be required to prove it. Unfortunately, your word is not enough; you will need documentation.
Should your spouse attempt to conceal ownership of property or contest your ownership, it’s almost always worth taking the situation to the next level and hiring an attorney.
Am I responsible for my spouse’s debt if we divorce?
We briefly mentioned earlier that debt is wrapped up in how assets and debt are divided in divorce, but how exactly does this work?
Since Texas is a community property state, spouses are equally liable for debt, including debt on credit cards held solely by one spouse. Keep in mind, however, that while debt can be reassigned, a credit card cannot, even if the judge deems the debt on that card your spouse’s responsibility. If a card is registered under your name, it is your financial responsibility at the end of the day. Failing to pay it will have a negative impact on your credit score. That is why debt is sometimes used to offset assets when looking at the big picture of property division.
As far as joint credit card debt is concerned, this can also have a negative impact on your credit score. Since you can’t remove your name from the account, you’ll need to make sure the account is handled properly and the payments are made on time. Once it’s paid off, then you can close the account.
If your spouse fails to pay for his or her portion of the debt, you can sue them. But other than that, you will have to remain consistent with your credit card and debt obligations.
Understand your financial situation better with a lawyer
Now that you’re more knowledgeable about how assets and debt are divided in a divorce you can have more confidence in your next steps. However, even if you’re filing a no-fault divorce and are not necessarily worried about how your debt and assets will be distributed, it’s a good idea to invest in an attorney. Avoid cheap divorce lawyers in Texas and seek out an attorney who has skilled at both divorce mediation and aggressive negotiations. If there are children involved, a lawyer will be an even wiser investment, especially if you’re a father.
Thiessen Law Firm’s Taly Thiessen is considered a top Father’s rights lawyer in Texas. With experience handling child custody cases, abusive situations, and one-sided divorces, Taly Thiessen can guide you through your divorce proceedings and help you solidify the best possible outcome.
Contact us online or call us at 713-864-9000 to get started today.
More Helpful Articles by Thiessen Law Firm:
- How to Arrange Child Support Modification
- Child Custody During COVID-19
- Divorce During COVID-19
- How Does Joint Custody Work in Texas?
- Child Custody Tips for Fathers
