New Mexico is a community property state. This means that all marital community property is presumed to be equally owned between spouses. In turn, under NM law, community property is equally divided upon divorce.
At times, however, not all community property is split 50-50. There are several reasons for an unequal division of community property during divorce. Let’s unpack this common divorce issue.
REASONS FOR UNEQUAL DIVISION OF COMMUNITY PROPERTY OR DEBTS DURING DIVORCE
New Mexico law presumes that most marital property or debt that either spouse builds during a marriage is community property. Accordingly, this marital community property or debt is split 50-50 upon divorce. This presumption also applies to property that is purchased during the marriage but help in one spouse’s name.
For instance, a vehicle/home that is purchased during the marriage, but titled exclusively in one spouse’s name, is presumed to be community debt or property. As such, this community debt or property is subject to being split. Nevertheless, New Mexico’s presumption towards marital community property can be overcome, when:
- A valid post-nuptial agreement is entered; or
- The property is purchased with sole and separate funds; or
- Property is inherited during the marriage.
UNEQUAL DIVISION OF COMMUNITY PROPERTY DUE TO COMMUNITY WASTE
At times, NM courts order an unequal division of marital community debt or property due to community waste. In some cases, a claim is raised that the other spouse wasted community funds. Consequently, the spouse raising this claim asserts a right to being compensated for the wasted money.
Claims for community waste may involve money spent on something that did not benefit the other spouse or the community. This community waste may include:
- Goods/items;
- Food/entertainment;
- Services; or
- Trips/vacations.
If community waste is deemed to have occurred, one spouse may be reimbursed for half of the total expense that did not benefit the community.
Moving forward, let’s assume that the marital property or debt at issue is community and subject to a 50-50 split. In this situation, can the parties agree to an unequal split?
UNEQUAL DIVISION OF COMMUNITY PROPERTY AS AN OFFSET
Most commonly, both spouses agree to an unequal division of community assets or debts as an offset. When reaching a divorce settlement, either party can agree to an unequal division of community debt or property as an offset towards another claim/issue.
A skilled Divorce Settlement Facilitator often develops creative ways to reach an overall agreement. In this regard, home equity or retirement accounts represent most couple’s largest assets. Accordingly, most creative offsets include agreements involving home equity or retirement accounts.
For instance, one spouse may waive their share of equity in the community home, in exchange for the other spouse agreeing to waive spousal support. At times, one spouse may assume more than 50% of the community debt (credit card, tax debt, etc.) in exchange for keeping their full retirement account.
In reaching a divorce settlement, one asset or debt can be exchanged for any other asset or debt. In doing so, the parties can resolve the divorce through a creative and unequal division of community assets or debts.
OTHER REASONS FOR UNEQUAL DIVISION OF COMMUNITY PROPERTY OR DEBT
At times, judges order an unequal split of community debt or property for “equitable” reasons. In some cases, an unequal division may be ordered based on one spouse’s inability to pay/service the underlying asset or debt. One spouse’s inability to service the asset or debt may result from unemployment or disability. For instance, the court may grant one party a community asset — such as the marital home — when the other party is unable to pay the mortgage and the home has minimal equity.
In other situations, the court may order an unequal split as a sanction/punishment. For example, the court may sanction one spouse for bad behavior. This bad behavior may include one spouse damaging community property. Alternatively, this punishment may involve the improper management of a community asset. Based on this bad conduct, the court may grant one spouse a greater slice of the community pie.
TOP/BEST DIVORCE LAWYERS FOR MEN OR WOMEN
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Sanchez has handled uncontested divorces all across New Mexico, including: Albuquerque, Santa Fe, Taos, Rio Rancho, Los Lunas/Belen, and Gallup/Grants. Also, Sanchez has handled contested divorces across New Mexico, including: Albuquerque, Santa Fe, Socorro/Estancia, Rio Rancho, Los Lunas/Belen, and Gallup/Grants. Talk to best divorce lawyer or attorney that knows what they are talking about.
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