When Couples Divide, So Do Their Debts in Community Property States

Texas is one of nine community property states in the U.S.; Nunneley Family Law can help

Up to one-half of all marriages end in divorce. What happens to the liabilities accumulated during these marriages ending in divorce? Someone must pay them. In community property states, both parties must split the debts, just as they split the assets.

Community Property

Texas is one of nine U.S. states which adheres to community property laws. This means each person is responsible for the amassed debts during the marriage no matter how they were held.

Debt can be held:

• In joint accounts, i.e., both names are on the accounts, or
• In separate accounts, i.e., one name is on each of the accounts.

In Texas, if one spouse opens a credit card account in his or her name, both people are responsible for that debt if they decide to legally end the marriage.

Most Common Debts to be Divided

• Mortgage – A mortgage debt is secured by the home. In this case, one party may receive 100% of the home if he or she refinances and places the mortgage debt in his or her name. If equity is in the home, this can be split by the refinance or by selling the home.
• Credit Card Debt – This is unsecured debt, and both parties must make arrangements to pay their portion. A challenge arises if the credit card issuer will not split the debt into two separate accounts, especially if one party has less than perfect credit.
• Auto Loans – This is a secured debt which is typically refinanced in each person’s name.

To ensure a fair division of debt, along with marital assets, a knowledgeable divorce lawyer can make all the difference in the world.

About Author

Nunneley Family Law has been helping families in the Fort Worth and Mid-Cities area resolve complicated family law issues for over 35 years. Their team of professionals provides the clarity and focus you need to break through the turmoil and reach equitable and fair closure.