Asset and debt division is one of the most contentious parts of many divorce proceedings. Even couples who’ve come to an amicable understanding about other issues (including child custody, spousal support, pet custody and more) may find themselves fighting about debt division. In a community property state, debts incurred during the marriage are usually divided equally by the court unless the parties come up with an alternative arrangement.

Creative arrangements are possible, though, wherein the parties agree to consider separate debts as part of a settlement in exchange for a different asset division scheme, or debts are split differently in exchange for more assets going to one party.

How mediation can help

When couples find themselves arguing about debt division, it is tempting to let the court decide how to split things. Unfortunately, having to litigate issues like this can result in a long, drawn-out process that breeds contention and adds a sour note to an otherwise amicable proceeding.

Mediation can help by encouraging parties to work together to find a solution that is best for the entire family. In mediation, a neutral third party works with the spouses to facilitate communication about key issues. Speaking of debts, contention may come if one spouse has run up debt that the other is unaware of. Since California is a community property state, both spouses are technically legally responsible for half of debts, even those in the other spouse’s name alone.

A mediator may be able to help the parties come up with a creative debt division solution, or, at the very least, help them avoid carrying over discontent about debt issues to the rest of the divorce proceedings.