In California, the state is a community property state. What this means is that any debts or assets you assume during marriage are shared equally by both parties. If you decide to divorce, then you each should walk away with 50% of that shared debt or income/property.
This is problematic for people who find out that their spouses have significant debt. After all, if they didn’t know about the debts or built up debts to pay for schooling to improve their financial situation in the future, debts may not feel like bills that they should pay.
Community property laws require you to split all marital debts collected
Community property laws do require that you and your spouse split your debts upon divorce, but that doesn’t have to mean that you can’t try to negotiate them away. There are a few things you can do.
For example, if you choose alternative dispute resolution options, like mediation, to discuss the debts, you may discover that some of the debts you thought were shared were actually from before your marriage. You could also work out a property division settlement that isn’t exactly 50-50. For example, if the debt is all for your spouse’s student loans, they may agree to take them over and to allow you to leave the marriage without taking those debts on.
Should you try mediation or alternative dispute resolution to resolve debts?
It can be a good idea to use alternative dispute resolution or mediation to resolve your debts because that gives you the best chance of working out a solution at the lowest cost to you. If you have to litigate, you will spend more money that would have likely been better spent paying down what you owe.
If you don’t want to take over your spouse’s debts, the best thing you can do for yourself is to focus on negotiating those debts away through fair discussions. If you and your spouse can agree on a different division of your debts, then you may be in a better position to get out of them when your marriage ends.