Jennifer Ray’s Legal Blog

Debts will either be characterized as a community debt or a separate debt.  If a debt is characterized as community, both spouses are liable for the debt prior to division.  A separate debt, on the other hand, will be the sole responsibility of the spouse whose name the debt is in.  A simple way to approach debt characterization is to determine when the debt was incurred.  If the debt was incurred after the date of marriage, the debt is typically considered a community liability meaning both parties can be held liable for its repayment.  Keep in mind that even if the debt was only issued in one party’s name, the debt will usually still be a “community liability.”  However, also be cognizant of the fact that no matter which party is awarded the debt (whether by the court or by agreement of the parties), a creditor can only look to the person who signed the credit agreement to satisfy payment of the debt.  Separate debts are those debts incurred by a party prior to marriage or that the creditor has agreed to solely look for repayment from the party’s separate property.  Also, student loan debts and obligations are specifically characterized as “separate” in the Texas Family Code unless one spouse cosigns the obligation for the spouse incurring the student loan debt.