Dividing the Marital Estate: Unsecured Debt

credit card debt in divorce

There are many layers in the division of marital estate during divorce proceedings. If you are going through a divorce and anticipate the division of unsecured debt, it is best to consult with an attorney to ensure a smoother divorce process.

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California Law Regarding Dividing Family Debt

In California, Family Code section 910 provides that the “community” is liable for all debts incurred during the marriage and prior to separation. The law does not consider who incurred the debt during the marriage or for which family member’s benefit the debt was incurred. It also does not matter whose name appears on the bill or credit card statements. As long as the debt was incurred during the course of the marriage and prior to legal separation, it is considered a community debt.

Division of Unsecured Debt

Because unsecured debt incurred during marriage is community property, it will be divided equally at divorce, similar to other community assets. In other words, when the spouses are negotiating a settlement and creating the divorce balance sheet, the unsecured debts should be divided equally between both husband and wife.

One option in dividing unsecured debt is for one spouse to pay off the joint debts in return for a greater share of the community property. Regardless of how the unsecured debt is divided, it is always best to consult with a family attorney.

We Can Help

For more information about dividing unsecured debt as part of the marital estate, please call  Zonder Family Law at (818) 309-7059.