Divorce and Debt in California—Who’s Responsible for Credit Cards and Loans?

When a couple divorces in California, discussions often focus on how assets are divided—but dividing debt is just as important. The way your shared debts are divided can have a profound impact on your financial well-being after divorce and the type of lifestyle you lead. That’s why we always recommend discussing your needs and priorities with a California divorce attorney from the very beginning.

At the Law Office of Taylor B. Warner, APLC, we know how important it is to start post-divorce life on the right foot—and that means not being saddled with more debt than what’s fair. Attorney Taylor B. Warner is proud to be a California Bar Certified Family Law Specialist, highlighting her commitment to individuals navigating divorce, custody issues, and other family law concerns. Schedule a time to meet with the team at our family law firm in Rancho Cucamonga by calling us at 909-466-5575.

California Community Property Laws and Debt

California is one of just a few states that follow community property rules. This means that debts incurred during the marriage are generally the responsibility of both spouses, regardless of who signed the paperwork or filled out the application. This includes everything from credit cards and personal loans to auto loans and medical bills.

Even if only one party benefited from the debt (for example, a credit card that only one spouse used), both people are likely responsible for it in California. The same can’t be said for debt that one party had before the marriage or incurred after separation—these scenarios are very fact-specific and may vary.

Different Types of Debt

Credit card debt can be a source of disagreement in divorce—couples often get caught up in debates over who used the cards most, who has the items that are still being paid off, and how debt should be fairly divided. Our divorce law firm can fight for a fair split that doesn’t leave you paying for your ex’s financial decisions for years to come.

Secured debts typically stay with whichever spouse keeps the asset, although that’s not a cut-and-dry rule. If the spouse who takes over the secured debt payments does not make those payments, the creditor may come after the other party—even though they no longer have access to or use of the asset.

Your debt split is an agreement between you and your ex. If debt is assigned to them during the divorce, but they don’t pay it, the creditor is within their rights to come after you for payment. You may be able to address this during negotiations by having each party refinance debts into their own name instead of keeping both spouses’ names on all shared debts. As an added benefit, this also limits the need for ongoing contact after divorce.

What If Your Ex-Spouse Stops Paying?

The real worry for many people is that their ex-spouse will simply stop paying, regardless of what the divorce agreement says. Unfortunately, you can’t just give creditors a copy of the divorce agreement and expect them to only pursue your ex. They can legally pursue collection from anyone named on the debt, no matter what your divorce agreement specifies.

This is challenging when one ex-spouse cares about their credit (and makes payments on time) and the other couldn’t care less (so they pay if they feel like it). The spouse concerned with preserving their credit may have to make payments to keep the account current and then take their ex-spouse back to court with the help of their divorce lawyer to hold them in contempt or seek reimbursement. It’s not an ideal situation, but it’s often better than watching your credit score drop.

You may be able to avoid this situation entirely by refinancing after divorce. For example, the spouse who keeps the car may refinance into a separate auto loan that only has their name on it. If one spouse takes the credit card debt, they may transfer the debt via a balance transfer, which puts the debt solely in their name.

Get the Legal Advice You Need From Our California Divorce Lawyers

Our team is here and ready to help you through your divorce. It may be one of the most challenging things you ever go through, but you will get through it. Get started now and set up a consultation with a divorce attorney by calling us at 909-466-5575 or reaching out online.

Taylor Warner

Taylor has always been an advocate. Growing up the middle child with an older and a younger brother, Taylor developed a strong voice and personality and has always felt strongly about helping others. Becoming a lawyer seemed to fit Taylor’s personality and character – she is a strong leader and a bold advocate. Learn more here.