Are you going through a divorce in New Mexico and concerned about how your assets will be divided? If so, understanding property division and community property laws can help ease your worries about protecting what’s rightfully yours during a divorce.
In this deep dive into property division and community property laws in New Mexico divorces, Moving forward, Sanchez Legal Team explores the intricacies of the process about property division and community property laws in New Mexico divorce. In doing so, we’ll provide valuable insights about NM divorce law and how to safeguard your assets.
New Mexico is a community property state. This means that assets and debts that are built during the marriage are usually considered joint property. Therefore, assets and debts accumulated during the marriage are usually split 50-50 upon divorce.
However, there are exceptions to this rule. Consequently, it is crucial to protect your assets when facing an contested or uncontested divorce in Albuquerque, NM.
Whether it’s your house, car, business, or retirement accounts, knowing how to navigate New Mexico’s property division laws is essential to secure your financial future.
New Mexico is one of nine community property states. This means that assets and debts that are acquired during the marriage are typically considered joint property. Moreover, this includes income earned, property purchased, and debts incurred during the marriage.
Nevertheless, there are exceptions to this rule. Property acquired before the marriage, gifts, and inheritances are generally considered separate property and not subject to division. What’s more, personal injury settlement for pain and suffering, or punitive damages, are usually considered separate property.
At times, distinguishing property as separate or community can be confusing. For example, if an individual owned a business before the marriage but used community funds to expand or maintain it, the business may be considered partially community property.
Also, homes purchased before marriage are considered separate property. Nevertheless, the payments made during the marriage that reduce the home’s debt can be considered community. Consequently, payments during the marriage that reduce the home’s principal debt can be split 50-50 upon divorce.
Next, community labor or funds used to improve the home can be considered community property.
Finally, it’s worth noting that New Mexico is an equitable distribution state. This means that property division should be fair and equitable, but not necessarily equal. In other words, judges don’t have to divide property down to the penny.
Equitable powers give Albuquerque family court judge’s discretion in dividing property based on a variety of factors. These factors include the duration of the marriage, the earning potential of each spouse, and the contributions of each spouse to the marriage.
One of the most critical factors in property division is determining which assets are separate and which are community property. As mentioned, separate property includes assets acquired before the marriage, gifts, inheritances, and personal injury settlements for pain and suffering.
Community property, on the other hand, includes assets acquired during the marriage. These assets include income, real estate, and personal property.
One common misconception is that separate property is always safe from division. However, separate property that increases in value during the marriage can become community property. For instance, property that increases due to actions taken by both spouses, such as improvements made to a home or investments made with community funds, may be considered community property.
It’s also important to keep accurate records of separate property, such as documentation of inheritances or premarital assets. This can help ensure that separate property is not inadvertently commingled with community property, making it more difficult to protect. In other words, keeping detailed records helps one to trace separate vs. community property.
When dividing property during a divorce, New Mexico family courts consider a variety of factors, including:
The duration of the marriage is often a crucial factor in property division. In general, the longer the marriage, the more likely it is that assets will be divided equally. However, this is not always the case, and other factors may come into play.
The income and earning potential of each spouse are also significant considerations. If one spouse earns significantly more than the other, they may be awarded a larger share of the assets to ensure that both spouses can maintain a similar standard of living post-divorce.
Moreover, a big disparity in property or income is a factor considered when determining alimony/spousal support in New Mexico.
Generally speaking, the two biggest factors that impact alimony in NM are need and ability to pay.
The value of the property and any outstanding debts are also critical factors. If one spouse is awarded an asset, such as a house or business, they may also be responsible for any associated debts.
At times, the debt may be greater than the value. In this situation, the debt is determined and can be used to offset any other assets accumulated during the marriage.
Property division can be a contentious issue, and there are several common challenges that can arise, including:
One spouse may attempt to hide assets to avoid sharing them with the other spouse. This can be challenging to detect but is illegal. An experienced divorce attorney can help uncover hidden assets and ensure that all assets are accounted for during property division.
Check out this informative video about dirty divorce moves in Albuquerque, New Mexico.
Valuing assets, such as a business, can be complex and require the assistance of a professional appraiser, such as a forensic accountant. Disagreements over the value of assets can lead to disputes during property division. In turn, these disputes can significantly increase the divorce’s cost and necessary time to complete.
Spouses may have emotional attachments to certain assets, such as a family home or sentimental personal property. This can make it difficult to negotiate a fair division of assets.
In other words, sometimes spouses spend dollars fighting over pennies that are emotionally significant. We’ve all heard the divorce cliché about spouses fighting over the bedroom rug or night stand.
Protecting your assets during a divorce requires careful planning and strategy. Here are some tips to help safeguard your assets:
A pre-nuptial agreement is a legal document that outlines how assets will be divided in the event of a divorce. While it may not be appropriate for every couple, a pre-nuptial agreement can provide valuable protection for individual assets.
Click here to read learn more about pre-nuptial agreements in Albuquerque, New Mexico.
Keeping accurate records of separate and community property can help ensure that assets are not improperly commingled. It’s also essential to keep track of any contributions made to separate property during the marriage.
Are you claiming that property purchased during the marriage was from separate funds? If so, it is essential to have documentation that supports this claim.
An experienced Albuquerque divorce attorney can provide valuable guidance and during property division with a New Mexico divorce. They can help uncover hidden assets, negotiate a fair division of assets, and protect your individual assets.
Navigating property division can be overwhelming, but working with a divorce attorney can help simplify the process. An experienced attorney can provide essential guidance throughout the divorce process, including property division.
During an initial consultation, a divorce attorney can review your assets, help identify separate and community property, and provide guidance on how to protect your assets during property division.
A top Albuquerque divorce attorney can also negotiate with your spouse’s attorney to try and reach an agreement on property division or represent you in court if necessary.
Every New Mexico divorce must complete mediation/settlement facilitation before a trial is set.
Mediation is a process where a neutral and skilled third party helps facilitate negotiations between spouses. These negotiations involve all contested issues from child custody to property division.
Most Albuquerque divorce cases are settled outside of court. Divorce litigation can be expensive, time-consuming, and emotionally draining. As such, mediation provides a cost-effective and less adversarial approach to property division. In doing so, mediation enables both sides to meet in the middle to reach a mutually beneficial agreement outside of court.
In fact, most family court judges routinely and openly tell spouses that they are better off resolving their issues through mediation. This opinion is based on the spouse’s ability to take control over their divorce – rather than putting the decision into a judge’s hands.
At times, both sides leave the divorce court unhappy with the judge’s decision. Consequently, settlement facilitation is a great way for both sides to take matters into their own hands and decide their own future.
Property division can be a complex and contentious issue. Nevertheless, understanding New Mexico’s community property laws and the factors that courts consider can help protect your assets and secure your financial future during a contested or uncontested divorce.
By working with an experienced divorce attorney, keeping accurate records, and being transparent about assets, you can ensure a fair and equitable property division that protects your individual assets.
Remember, protecting your assets during a divorce requires careful planning and strategy. With that said, it’s possible to emerge from a divorce with your financial future intact.
Do you have more questions about New Mexico’s community property laws? If so, check out this informative video about dividing community property during a NM divorce.
Sanchez Legal Team’s top rated contested and uncontested divorce attorneys in Albuquerque are locally based and here to help.
Call (505) SANCHEZ and speak with one of Albuquerque’s best child custody, restraining order, and divorce attorneys.
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