Picking up from where we left off in Marital Property in Colorado Divorce: 6 Facts to Know (Pt. 1), below we will highlight some more important issues people should be aware of when it comes to marital property in Colorado divorce.
Fact 3 – Debts amassed during a marriage are usually considered to be part of the marital property.
When thinking about the division of marital property in divorce, the assets of the married couple likely first come to mind for many people. However, a married couple’s debts – in other words, the marital debt – is also a key part of what is considered to be “marital property.” As a result, as the court divides the marital property, it will divide up marital debt as “equitably” (i.e., fairly) as possible.
Common debts that are divided up as part of the divorce process may include (but are not necessarily limited to):
- Mortgage loan debts
- Car loan debts
- Credit card debts.
Here, it’s crucial to point out that:
- Student loan debts will typically NOT be considered to be marital property, so they won’t be part of the division of marital property in Colorado divorce.
- Just because one spouse may be deemed responsible for marital debt in the divorce decree does not necessarily mean that the other individual is legally off the hook for the debt. In fact, if the person who has been granted the debt in the divorce defaults on paying this debt, creditors can (and likely will) contact the other individual to seek payment of the debt.
Fact 4 – In some cases, individual property may become part of the marital property.
When people comingle their individual property with marital property and it becomes impossible to figure out what exactly is the marital versus individual property, for the purposes of dividing marital property during the divorce process, all of the comingled property will typically be considered to be a marital asset.
Take the example of a marital checking account. While the checking account that both spouses put money into will be considered to be a marital asset, if one party receives an income tax return or a bonus from work (which may otherwise qualify as a personal asset) but deposits these funds into the checking account – and then months later the couple files for divorce, determining where these funds are separate from the existing funds in the checking account may be downright impossible; therefore, all of the funds in the account will likely be considered to be part of the marital property that will be divided during the divorce process.
We will continue to discuss some important facts about marital property in Colorado divorce in the final part of this blog – be sure to check it out!
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When you are ready to file divorce, we will be ready to guide you through the process and provide you with the highest quality legal services. Since 1983, the Littleton divorce attorney team at Bahr and Kreidle has been committed to advocating our clients’ interests in divorce cases, and we are proficient at helping our clients resolve these cases as beneficially as possible.
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