Property and Debt Division

Marital property is property acquired during the parties' marriage and still owned at the time the marriage ends. Generally, marital property is acquired through the efforts of one or both parties. Property may be marital property even if the property's title is in the name of only one party. Usually, when a marriage ends, the value of the marital property is divided equally between the parties.

Separate property is property that is not marital property. When a marriage is terminated, separate property is awarded to the owner and is not divided between the parties. Five primary types of separate property exist:

• Property owned prior to the marriage
• Property received as a gift
• Property received as an inheritance
• Property received as a personal injury award
• Property addressed in a valid prenuptial agreement

Commingled property is property that is part marital property and part separate property. Generally, commingled property is treated like marital property because it is divided equally between the parties. However, in some cases, the separate property component will be distributed solely to one party. For this to happen, the party seeking the property must "trace" the current separate property component back to the original item of separate property. The party must show some strong relationship between the current separate property component and the original item of separate property.

Normally, for every item of property, a dollar value must be determined. Some items are easy to value, such as bank accounts. The balance in a bank account is determined online or from the most current bank account statement. Other items are more difficult to value. For example, conflicts often arise regarding the value of real estate and interests in businesses and professional practices.

When a marriage is terminated, a final court order will state what property is awarded to the husband and what property is awarded to the wife. A court order dividing property is final and cannot be modified.

A debt is a legal duty to pay money. Typical examples of debts include home loans (mortgages), car loans, home equity line-of-credit loans, and credit card debts. A debt can be classified as a marital debt or as a separate debt. Like property, the parties' debts are divided when their marriage ends.

If a court finds that a party has engaged in financial misconduct, the court may adjust the property- and debt-division to achieve a fair result. Various types of financial misconduct exist. For example, a party who wrongfully causes property to disappear or decrease in value has committed financial misconduct.