Dividing Debts in Oklahoma Divorce is not as simple as who acquired the debt and when. When you’re going through a divorce there’s more involved then child custody and visitation. Often times the emotion involved with deciding about child custody and the divorce process itself may cloud issues surrounding dividing marital debt. Given the complexity and the heat of the process itself our divorce clients often have a large number of questions and concerns about dividing debts in Oklahoma divorce. In fact, when explaining the property division portion of a divorce, the dividing up of debts is the most common question we’re asked. In Oklahoma, the courts follow the “equitable division” doctrine, which seeks to divide assets and liabilities fairly. However, fairly does not necessarily equal 50/50.
Dividing Debts in Oklahoma Divorce
Marital Property Debts
Oklahoma law puts debt into one of two categories—marital or separate property. So during a divorce process, the equitable division doctrine will take into account which property is marital and which is not. As a result, understanding which debts are marital property is very important. Marital property essentially belongs to both spouses in the marriage equally. Separate property does not.
First, the marital debts will separate into secure or unsecured debt. This simply means that secure debts have tangible property that a creditor can take for non-payment and unsecured debt does not. For example, if you do not make your house payment a bank can put your home in foreclosure and eventually seize it. This is secure debt. Unsecured debt generally falls under credit card debt. Therefore, the spouse who receives the marital property with a payment attached to it will also be liable for those payments after the divorce. The spouse who does not receive the marital property, will no longer be liable for the payments.
Second, if you and your spouse have unsecure debt, then you will both be liable for the payments even after the divorce is complete. This is because, under the doctrine of equitable division, you and your spouse likely both benefitted from the use of credit cards in the marriage. So this would be marital property and subject to fair division.
Separate Property Debts
The idea of separate property is a bit vague in the sense of designating liability. For instance, student loan debt for a professional degree is usually separate property. This means that because the knowledge from the degree will only benefit one spouse once the marriage dissolves, the debts attach to only that spouse. However, if the student loans went to pay for housing or any other contribution to the household, then it is marital property. This would make both parties liable for paying off the loan. But, if the debt is strictly separate property, then only the spouse incurring the debt will be liable for it after the divorce.
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OKC Family Law Attorneys
Our attorneys understand that dividing debts in Oklahoma divorce is important. Its a property and debt division that will impact your financial well being former many years after the divorce is finished. As set above, when the debt was acquired, what kind of debt it was, and the picture as a whole will be factors to consider. You’ve worked hard for your marriage and just as hard for your money. Call today for a free consultation with an OKC divorce attorney. 405.367.8710