Division of Property and Debts

There are common misconceptions about how property division works during a divorce. Many clients are surprised to learn that for purposes of determining whether property is separate or marital it does not matter whose name is on the title or which spouse’s family gave the wedding gift.

Separate property most commonly is property owned by a spouse prior to the marriage or that is acquired by gift or inheritance during the marriage. However, the increase in value of that separate property during the marriage is marital. Also, spouses often commingle separate funds with marital, which can greatly complicate the classification and division.

In Colorado, marital property is divided equitably. This does not mean 50-50. The court will divide the marital property based on several statutory factors. The parties have considerable leeway in dividing their property. If they cannot agree on a division, the court has considerable discretion when dividing marital property.

Assets and property are sometimes hard to classify and consultation with an attorney is a must. Client expectations regarding property distribution are sometimes incorrect, sometimes impossible and sometimes will lead to an unfair outcome for themselves or their children. Do not assume your spouse’s suggested property division is fair just because you want to get things over with.

Marital debts and liabilities are also divided in an equitable manner by the court. Any debt or liability incurred during the marriage and prior to the decree will be presumed to be marital, regardless of whose name is on the debt.

It is important to remember that the division of debt will not bind third party creditors, so enforcement of this obligation may mean ongoing litigation with your ex-spouse. Also, the division of property and debts during your divorce could impact a future bankruptcy proceeding. An attorney can help you evaluate your options in the division of marital property and debts.

Call Today For A Free Consultation

Our Northern Colorado family law firm offers free initial consultations to new clients. Please call us today at 970-624-6060.