In California divorce cases, the division of debts follows the same basic principles as the division of property, adhering to the community property system. This means that any debts incurred during the marriage—such as credit card balances, mortgages, car loans, and personal loans—are generally considered community debts and are subject to equal division between the spouses. Even if the debt is in one spouse’s name, if it was accumulated for the benefit of the family or during the marriage, it is typically treated as community debt. The court aims to divide these debts fairly, taking into account each spouse’s financial situation and ability to pay.
Debts that are considered separate property, such as those incurred before the marriage or during the marriage for personal expenses that don’t benefit the other spouse or the family, remain the responsibility of the spouse who incurred them. In some cases, debts may be allocated in a way that provides one spouse with more of the community property to offset their share of the debt, or the court may order one spouse to be solely responsible for certain debts. If one spouse is unable to pay their share of the debt or defaults on payments, the other spouse could still be held responsible if the creditor is pursuing repayment, which is why it’s important to clearly outline the division of debts in the divorce agreement. In complex cases, such as those involving significant business debt or disputes about the nature of certain debts, the court may require expert financial analysis to determine a fair division.
