When couples divorce, they must find ways to divide their property and their financial obligations. Assets acquired during marriage are subject to division when couples divorce. Spouses have to decide who keeps which assets.
They also have to divide the debts that they took on during the marriage. Credit cards are often a primary source of debt for married couples. Even accounts in the name of one spouse could be part of the marital estate. How do those accounts affect the property division process?
Debts can influence property distribution
Trying to find a fair way to split up property and debt during a divorce can be difficult. People have to complete a relatively extensive evaluation of their marital resources to propose fair solutions.
Spouses can choose to each take responsibility for certain credit card accounts. They can also negotiate arrangements in which the credit card balances paid by one spouse offset the property that they keep from the marital estate.
In some cases, spouses may try to pay off their marital debts in full as part of the divorce process. They may liquidate certain resources to achieve that goal. The need to pay off the debts can diminish the amount of property that the spouses have to divide.
Agreeing on a fair way to address credit card debt can be a challenge during complex divorce negotiations. Particularly in scenarios where spouses may have misused shared credit cards, there may be disputes about which debts actually belong in the marital estate. Learning more about property division rules and reviewing household finances carefully can help people seek the best solutions for marital debts given their circumstances.
