Contentious negotiations regarding the division of assets in a divorce is common in such California matters. Now, at least one authority asserts, it is not only assets that are commonly negotiated, but also the division of debts. In fact, reports indicate that the number of couples working to divide the debts during a divorce has grown as the recession has waged on.
In 2007, the average family in the U.S. had an average net worth of $126,400. In 2010, during difficult economic times, that average dropped down to $77,300. This 38 percent decline may be due in part to job loss, along with other financial difficulties such as the falling housing market.
Authorities find that couples who have credit cards with balances over $15,000, student loans, mortgages and car loans often negotiate a division of their debts in a divorce. In our state, the division may be subject to our community property laws that could create an even division of the accounts. However, each case is different and a court may make orders as to the division of debts as the divorce process continues.
The division of debts in a California divorce can help to ensure that the credit rating of each spouse is less negatively affected by the dissolution. A debt division may allow payments to be more easily made by each party, thus keeping accounts from falling into default. Though each divorce is different, the division of assets and debts is important to every divorcing couple, and they may benefit from efforts to negotiate a settlement.
Source: The Augusta Chronicle, “Debt often focus of divorce proceedings,” Kyle Martin, Sept. 23, 2012