Dividing assets and debts in divorce

Dividing assets and debts in divorce

On Behalf of | Mar 2, 2021 | Property Division

A divorcing couple will likely face numerous challenges through the process. From determining child support and crafting a parenting plan to dividing assets and debts, the couple will need to reach agreements on numerous topics. Separating the family’s finances in such a way that one household can support two new independent futures often represents a difficult negotiation.

Property division generally consists of two elements:

  • Asset division: A marriage that lasts years or decades will often benefit both partners through the acquisition of numerous assets. From a marital home and vehicles to valuable book collections and expensive furniture, the divorcing couple must work together to arrive at a beneficial compromise. Asset division is less about an equal split and more about an equitable distribution. This means that not every asset must be split in half (or sold and the profits divided), but each partner must receive a fair share of the overall value.
  • Debt division: Over the course of the marriage, the couple will have likely shared a certain amount of debt. Most often, this is reflected in a home mortgage or vehicle loans, however, the couple might have held a shared credit card or other joint finances. Just as property must be divided, responsibility for paying back this debt, too, is divided. The best course of action is to pay off any shared debt before the divorce process begins. This might not be possible for everyone, and the debt will be factored into the overall financial picture.

Additionally, the divorcing couple must thoroughly examine any digital assets such as shared social networking pages, online storefronts or digital entertainment collections. It is wise to work with a skilled divorce attorney as soon possible so you can receive the answers and guidance you need.