Credit Card Debt and Divorce in New Mexico

 

Are you facing a divorce and searching for information about credit card debt and divorce in New Mexico?  New Mexico is a community property state.  This means that assets or debts that are created during the marriage are usually split 50-50 upon divorce.

Credit card debt is the most common debt that a couple creates during a marriage.  Are you researching a divorce and have credit card debt during the marriage?  Let’s tackle the common questions about credit card debt and divorce in New Mexico.

 

HOW IS CREDIT CARD DEBT DIVIDED DURING DIVORCE IN NEW MEXICO?

 

In New Mexico credit card debt that was accumulated during the marriage is considered a community debt and is split 50-50 upon divorce.  All credit card debt that is generated during the marriage is usually split between the parties.

 

WHAT HAPPENS WITH CREDIT CARD DEBT BEFORE THE SEPARATION?

 

Credit card debt that is incurred during a marriage in New Mexico, and prior to separation, is considered community debt.  Both spouses are equally responsible for credit card debt that is accumulated during a marriage. An exception to this statement make exist with large purchases that obviously do not benefit the community.  Such purchases may include:

• Gabling debts;
• Lavish vacations without the other spouse;
• Body enhancement surgeries that do not benefit the community;
• Other large purchases that do not benefit the community.

There are rare exceptions when a NM judge will find that a purchase did not benefit the community.  You may successfully argue that the credit card debt is your spouse’s separate debt — but at what cost?  You may end up paying thousands of dollars in legal expenses, fighting over hundreds of dollars in credit card debts.

Judges generally take a hand’s off approach to credit card debt and will not audit every charge item by item.  NM judges lack the time and resources to consider if every credit card charge during the marriage was mutually agreed upon by the couple and benefitted the community.  Because of this fact, NM judges generally split all credit card debt that is accumulated during a marriage.  NM judges will not analyze or audit the how, what, or why of every charge that is incurred during the marriage.

 

AM I RESPONSIBLE FOR CREDIT CARD DEBT IF MY NAME IS NOT ON THE CREDIT CARD?

 

Yes.  Even though your name is not on the credit card, any debt that is incurred during the marriage is community debt and split 50-50 upon divorce.  Both spouses are usually responsible for any debt incurred during the marriage, even in situations where you were unaware of the credit card or debt.  This law applies to cases that are decided by a NM family court judge.  Your spouse can always agree to assume a larger portion of the community debt, through either settlement facilitation or an uncontested divorce.

 

CAN YOU PAY FOR YOUR ATTORNEY FEES WITH A CREDIT CARD?

 

Yes.  You can pay for attorney fees with a credit card.  However, your attorney fees are usually considered separate debt because the debt usually is incurred after the separation and does not benefit the community.

In situations where one spouse has unequally access to money – possibly because one spouse was a stay-at-home parent or disabled – the court can advance attorney fees from available community funds.

 

WHAT CAN NM COURTS DO IF A SPOUSE IS WASTING COMMUNITY ASSETS?

 

New Mexico’s tendency to equally split any debt that is incurred during a marriage seems unfair.  NM judge’s generally split this debt because doing otherwise could burden the court, clogging the system and preventing the efficient flow of cases.

NM Judges have “equitable powers” and divide community property and debt in the interests of justice and fairness.  This means that NM judges often consider large and particularly egregious acts of wasteful spending.

NM judges can consider debt that is incurred due to:

• Gambling;
• Transferring or disposing large sums of money;
• Money given to family members without your knowledge or consent; or
• Other forms of wasteful spending that did not benefit the community.

Your judge can consider the wasteful spending and through equitable powers grant you a large share of the community property, or a smaller share of the debt.

 

WHAT TO DO WHEN A SPOUSE IS SPENDING TOO MUCH ON CREDIT CARDS OR WASTING MARITAL ASSETS?

 

File for divorce or legal separation.  You could also try to contact the credit card company to prevent further spending.  Even if you can successfully stop the spending with one credit card account, your spouse may open additional, or new accounts.  Your spouse’s spending is a huge red flag that there are major issues in your marriage.

 

WHAT HAPPENS IF A HUSBAND/WIFE RAN UP CREDIT CARD DEBT DURING MARRIAGE?

 

All debt that is incurred during a marriage is usually evenly split between the parties.  NM courts rarely will find that debt accumulated during the marriage is one party’s separate debt.  This means that you should actively monitor your accounts during a marriage.  You should also periodically run a credit check to ensure that your spouse is not running up debt during the marriage.

 

AM I RESPONSIBLE FOR MY HUSBAND’S/WIFE’S DEBTS IF WE DIVORCE?

 

You likely will be responsible for any debt that was incurred during the marriage.  Debt that is incurred before the marriage, or after the separation, is usually considered your spouse’s separate debt.

 

WHO IS RESPONSIBLE FOR DEBT AFTER DIVORCE?

 

It depends on when the debt was incurred. Debt that is incurred during the marriage likely will be considered marital debt and split 50-50 upon divorce.  Debt that is incurred before the marriage is usually considered separate debt.  Likewise, debt that is incurred after the separation is usually considered separate debt.

 

IS PERSONAL DEBT SHARED IN DIVORCE?

 

Debt that either spouse incurs during the marriage is considered community debt and is usually split 50-50 upon divorce.  Debt that is incurred either before the marriage, or after the separation, is usually considered a spouse’s separate debt.

 

AM I RESPONSIBLE FOR MY SPOUSE’S CREDIT CARD DEBT?

 

You are responsible for credit card debt that your spouse incurs during the marriage.  You likely are not responsible for any credit card debt that your spouse incurred before the marriage, or after the separation.

 

AM I RESPONSIBLE FOR MY SPOUSE’S DEBT AFTER SEPARATION?

 

Probably not.  Debt that you or your spouse acquires after separation usually is considered separate debt.  Credit card debt that is accumulated after the separation generally is not included in the assets and debts worksheet that divides assets and debts that are generated during a marriage.

 

FINANCIAL RESPONSIBILITY DURING SEPARATION

 

Money that is earned after divorce, but while the divorce is pending, is considered community funds.  In situations where one spouse makes considerably more money, the court can divide the community funds through an interim division of income and expenses (Interim Support).  Interim Support essentially divides community funds/money that is generated while the divorce is pending. Interim Support is a form of alimony while a divorce is pending.  For more information on Interim Support, click HERE.

Alimony/spousal support begins after the divorce is finalized.

 

DO YOU TAKE ON/INHERIT YOUR SPOUSE’S DEBT WHEN YOU GET MARRIED?

 

No.  Any debt that exists before the marriage is usually considered your spouse’s separate debt.  The following debt is your spouse’s debt, if created before the marriage:

• Tax debt;
• Medical debt;
• Credit card debt;
• Student loan debt; or
• Any other debt created before the marriage.

 

(505) SANCHEZ EXPLAINS CREDIT CARD DEBT AND DIVORCE IN NEW MEXICO

 

Are you facing a divorce and are searching for information about credit card debt and divorce in New Mexico?  You’ve found the right person to answer your questions.  Matthew Legan Sanchez has been handling divorce trials in New Mexico for over a decade.  Sanchez has the experience that you need.  Call (505) SANCHEZ For more information.