Debt and Divorce in Arizona
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May 7, 2021

Debt and Divorce in Arizona


Debt Divorce Arizona
Debt and Divorce in Arizona

When two people get divorced, you often think about all of the property they own and who gets what. While someone may want to keep the car or the house, they may also want to avoid debt. This could be debt created during and for the marriage, like that new TV or car, or personal debt, such as educational debt. Either way, it can be a tricky process to navigate who gets what in a divorce, including debt. It can be a fraught subject, especially during a divorce that is not ending amicably.

At Reppucci & Roeder, we fight to make sure you get what you deserve. In this post, we will briefly talk about how marital debt works in divorce in Arizona.

What happens to our debt in Arizona when we get divorced?

 Arizona is a “community property state.” What does community property mean? It means that all property (assets and liabilities) will be merged and then divided if and when the marriage ends. Basically, if you are in a community property state like Arizona, you will generally get half of the property unless the court thinks otherwise. This is because all property obtained during the marriage is presumed to benefit the community (the couple) and will be divided equitably. The same is assumed with debt.

While this presumption can be overridden, it will take clear and convincing evidence to prove to the court that a debt is not a community debt.

What kinds of debt are we talking about?

Marital debt—such as for the family house—will be divided in the same way. Marital debt refers to debt that was created during the marriage. Debt can arise from the usual sources: car loans, taxes, mortgages, student loans, and credit cards.

Importantly, it is not significant which person generated the debt; what matters is that the debt was created during the marriage. Legally speaking, debts created during the marriage are considered marital debts.

What if a debt is not mine?

Because debt involves money, it can be a hotly debated topic during a divorce. This can especially be true when parties are assigning blame. But if the debt is marital, it will be divided based on the community property rules defined above. This means you may end up with debt that you believe is not “yours.” For instance, if a spouse has a credit card, it can be marital debt—and therefore your responsibility too—even if the card has their name on it.

However, if that credit card were opened before the marriage began, then it would remain that person’s individual responsibility. Similarly, debts created after the divorce action legally begins are not the responsibility of the other spouse. This means that if the debt were incurred before or after the marriage, you would not be responsible for your spouse’s debt and vice versa.

What about wasteful spending?

 While all debts incurred during the marriage will generally be the responsibility of both parties, a spouse could claim that the other spouse racked up debt due to “wasteful” spending. This is based on the idea explained above that property purchases are supposed to “benefit the community.” Each party is supposed to act in a way that will not be wasteful or burdensome to the other spouse to build their mutual wellbeing.

In the simplest sense, when one party thinks that the other party did something that did not benefit the community, that party can claim the other party “wasted” or misused community property. Obvious examples include situations like an affair or gambling, which clearly benefits just one person, not the couple.

 How will it be divided?

 Like any other property, the parties can decide to split the debt up how they see fit. If they cannot agree, the court will decide for the parties. In other words, the court has the discretion to decide but has to act “equitably,” which is a general term. In deciding, the court can consider many elements of the relationship, including the future earning ability. In addition, the court could make both parties liable for the debts, which is called being “jointly liable.”


Contact Reppucci & Roeder Today

At Reppucci & Roeder, we are here to help you get through a difficult time. Divorce is stressful, and dividing property can be very hard. We want to get you the best outcome possible through negotiation and building the best case possible. Property and debt can be an emotional topic, but we will be by your side, advocating for you.  Call us today at  (480) 418-6420 for your free consultation.

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