In Texas family courts, the division of property is governed by community property laws. In this process, the court will seek to divide you and your spouse’s marital assets and debts in a manner that is just and fair, but not necessarily equally.
What is community property?
Community property refers to all types of property, assets and debts acquired by either couple during their marriage. Six common types of this include:
- Real estate property
- Earned income from employment
- Joint bank accounts
- Retirement accounts
- Personal property (e.g., cars, furniture, jewelry)
- Any existing debts or loans
To help establish fair distribution of community property between both parties, the court will consider several determining factors, including you and your spouse’s health, education and future earning capacity, your children’s needs (if you have any) and your length of marriage.
What are the common types of marital debts?
Marital debt refers to any debt or loan acquired by either spouse during the marriage. In Texas, marital debt is not divided by the court equally, but rather equitably. Here are three common types of marital debt:
Car loans: The remaining car loan will be managed by the spouse who will keep the car. However, if you and your spouse mutually agree to sell the car, you can share the proceeds and pay off your remaining car loan amount.
Mortgages: The family residence typically holds a large amount of debt. To divide this fairly, you and your spouse must settle whether one of you wants to keep the house and assume its mortgage payments, or sell the house together and use the proceeds to pay off the mortgage.
Credit card debts: These debts are complex and will typically require the help of a financial expert. This professional can analyze whether the credit card was used for an individual expense or a joint expense.
For example, if the credit card debt was for a household expense, the court will consider it as a marital debt. On the other hand, if the credit card debt was for an individual expense, the court will consider it as an individual spouse’s debt.
Divorce can be a scary process to navigate on your own. However, by understanding Texas’ property division process and learning about which types of debts are marital debts, you can protect your rights and pursue a fair division of assets.