Divorce involves complicated financial decisions, especially when a couple enters the divorce process with debts. It is crucial for people to understand how the court divides debts during the divorce process. What should you know?
Do Texas courts divide debt during divorce?
In Texas, debts that either spouse takes on during the marriage are usually “community property,” and spouses are joint owners of these debts. This includes anything from credit card debts to home mortgages acquired during the marriage.
When getting a divorce, the court needs to divide these jointly owned debts between the spouses. This division is not always an equal split. Instead, courts divide debt based on what is “just and right” in the couple’s situation.
How do courts decide who pays for Texas marital debt?
When you file for divorce, a Texas court will look at your finances to decide how to divide your debts fairly. They consider each person’s financial situation, earning ability and how the debts happened. For example, if one spouse used a credit card for a family vacation or essentials, the court usually sees this as community debt.
Deciding who pays what may depend on keeping clear records of all debts. These records not only show how much debt you share with your spouse but can also show who benefitted from each debt.
Could you still end up paying for those debts after divorce?
Joint debts have the potential to create challenges even after divorce. Even if the court says one spouse should pay a joint debt and that spouse does not make payments, collection agencies might call the other the original agreement was made with both spouses. As a result, it is important to have clauses in the divorce agreement that protect you if your ex does not pay.
Whether you are in Austin, Round Rock or anywhere else in Texas, getting advice from a knowledgeable divorce lawyer is essential to safeguard your interests during the process. Having the right information and guidance form an experienced Austin divorce lawyer can help you make the right choice for your situation.
The choices you make during divorce will affect your financial future. With the right strategy, you can maintain your financial health.