Around Texas, people may believe that divorcing couples fight over everything when deciding how to divide their property. One part of a property division agreement that they may not squabble over involves the couples’ debts.
Both assets and debts are property that must be divided when a marital partnership ends. Courts look at what property is truly separate, such as property that is owned or inherited by only one member of the marriage, as well as marital property, which is almost all of the other property gained during the marriage.
With regard to debts, items such as a home’s mortgage and credit card balances can be divided and assigned to divorcing parties. One relatively unique form of debt that can either be separate or marital relates to education debts incurred during a marriage.
Some individuals take out loans exclusively to pay for their tuition charges and direct educational fees. In those cases, the loan debts are generally considered to be the separate property of the person who worked toward the degree. However, when educational loans are used to pay for housing, food, and other expenses that benefit both partners to a marriage, those debts are more likely to be viewed by a court as marital property.
Courts can also factor in the spouses’ post-divorce abilities to pay off loans as well as who may benefit from the tax implications of being burdened with student loan debt. While this all may seem rather confusing, individuals working toward divorce can benefit from utilizing the expertise of Texas divorce attorneys. Those attorneys are specially trained to handle the delicate negotiations of property division and can protect their clients’ rights during contentious divorce proceedings.
Source: Forbes, “Are Student Loans Incurred During The Marriage Considered Marital Debt?” Jeff Landers, Dec. 17, 2013