Many Colorado couples focus the bulk of their divorce efforts on dividing marital wealth. What they often forget, however, is the role that debt plays in the property division process. Understanding how debt factors in to the big picture can help spouses make wise property division choices.
In most cases, debt that is brought into the marriage remains the obligation of the party who held that debt from the beginning. However, debt incurred during the course of the marriage is another story. Very often, debt taken on by one spouse becomes the financial obligation of both if the marriage ends in divorce.
Even of only one spouse's name is on an account, it is easy to make the argument that the items purchased were for the benefit of both spouses. That is especially true if the purchases were for entertainment, vacations, furnishings or other household items. There is no guarantee that a judge will compel the account holder to accept responsibility for the entire balance.
When preparing to divorce, the best way for Colorado spouses to proceed is to make a thorough and careful evaluation of all assets and debts. List all accounts, and be sure to note which accounts belong to only one party, and which are shared. A family law attorney will be able to go through the list and help determine which accounts are likely to be divided, and which might be kept separate. That can make it easier to know what to expect during the property division process.
Source: madison.com, "You Could Get Stuck With Your Spouse's Debt in Divorce", Christy Bieber, Nov. 16, 2017