Debt Must Go to Someone
While many people are familiar with the concept of property division in a divorce, they may be surprised to learn that debt must also be divided. How debt is divided, however, depends on factors similar to those of property division.
Read on to learn more about debt division in a Colorado divorce.
Principles of Asset Division
Colorado law states that all property up for division in a divorce must be done so in a manner that is equitable. Property is determined to be either marital (meaning it was acquired during the marriage) or separate (meaning it was acquired prior to marriage OR inherited/gifted to one party in a marriage), and only marital assets are divided in a divorce.
Relating These Principles to Debt
Debt must be divided in the same manner as assets. This means that it must be determined if the debt was accrued prior to the marriage or during the marriage, and only marital debts are divided in the divorce.
For example, if one spouse has car payments that began prior to their marriage, those car payments are separate and will remain with that spouse after the divorce is finalized. By contrast, if one spouse accumulates credit card debt while married, then that debt must be divided in an equitable manner.
It should be noted that debts do not become separate once again when a couple files for divorce. If one party in a divorce accumulates debt while the process is ongoing, then those debts are still considered marital debt because the divorce is not yet finalized. Keep in mind, however, that equity may mean that the party who accrued this debt may have greater liability in paying it off.
Partner With Your Attorney for Property and Debt Division
When preparing to file for divorce, you will want to begin working with an attorney who can understand your goals going into the process and who will strive to meet your needs. At Law Office of Greg Quimby, P.C., our team of attorneys is prepared to help you work through each step of the divorce process no matter how complex, and we will do so with your best interests at heart.
Learn more about divorce and asset division in Colorado or schedule your consultation with a member of our team by calling us at (719) 212-4227. If you would like more information, you can also visit our website.