When you go through a divorce in Texas, dividing debt in a Texas divorce is one of the most important financial decisions you’ll face. Unlike some states, Texas follows community property laws, which means most debts you and your spouse accumulated during marriage belong to both of you—even if only one person’s name is on the account. Understanding how Texas courts handle this division can help you protect your financial future.
Why Choose Adams Law Firm
At Adams Law Firm, we’ve guided families through complex debt division cases for over 35 years. Based in Katy and serving the greater Houston area, our team understands Texas community property law inside and out. We’re recognized as top family lawyers by H-Texas Magazine and hold an AV Preeminent® rating from Martindale-Hubbell® for exceptional ethical conduct and legal ability. Our experienced attorneys have helped countless clients protect their financial interests during divorce proceedings, and we approach each case with the hard work, respect, and creative thinking your situation deserves. When you need guidance on dividing debt in your Texas divorce, call (281) 391-9237 to schedule a consultation with our experienced team.
Understanding Community Property in Texas Divorce
Texas is a community property state. While Texas Family Code § 3.002 defines community property, the treatment of debt is complex. Debts incurred between the date of marriage and the date of divorce are generally obligations of the community estate. However, simply being married does not always make a spouse personally liable for a debt solely in the other spouse’s name, unless the debt was for ‘necessaries’ (like food or shelter) or the spouse acted as an agent.
When dividing the estate, the court applies a ‘just and right’ standard. This allows the judge to assign debt repayment responsibilities based on fairness rather than a strict 50/50 split. Even if the court orders one spouse to pay a joint debt, it is important to note that creditors are generally bound by the original contract terms, not the divorce decree.
Types of Debt Divided in a Texas Divorce
Different types of debt are handled in various ways during divorce proceedings. Understanding which debts apply to your situation helps you prepare for negotiations or court hearings.
Credit Card Debt
Credit card debt accumulated during marriage is usually considered community property. If both spouses used a joint credit card, both are liable to the creditor. Courts may assign the debt to one spouse or split it between you. The key issue is that creditors don’t recognize divorce decrees, they can pursue either spouse for payment, even if the court assigned the debt to your ex-spouse.
Mortgage and Home Equity Debt
Mortgage debt on a home purchased during marriage is generally community liability. Courts typically award the home to one spouse and order that person to assume responsibility for the payments. However, the court cannot simply take a name off the mortgage. Typically, the spouse keeping the home must refinance the loan to remove the other spouse’s liability. If refinancing isn’t possible, the court may order a ‘Deed of Trust to Secure Assumption’ to protect the spouse who is giving up the house.
Auto Loans and Personal Loans
Vehicle loans taken out during marriage are community debt. The court may award the vehicle to one spouse and assign the loan to that person, or require the vehicle to be sold. Personal loans follow the same community property principles.
How Texas Courts Divide Marital Debt
When a judge divides marital debt, they apply the “just and right” standard under Texas Family Code § 7.001. This means the division should be fair based on the specific circumstances of your case, not necessarily equal. Courts consider several factors when making these decisions, including each spouse’s income and earning potential, who benefited from the debt, the length of the marriage, and custody arrangements if children are involved.
One common approach is for the court to award all of one debt to one spouse and an equal value of another debt to the other spouse. For example, one spouse might keep the house and its mortgage while the other keeps investment accounts or retirement funds of similar value. Another option is for the higher-earning spouse to assume more debt, allowing the lower-earning spouse to start fresh financially.
Separate Debt vs. Community Debt
Not all debt is divided in divorce. Separate debt generally includes money you owed before the date of marriage. While debt incurred after the divorce is final is also separate, it is important to know that Texas does not recognize legal separation.
This means that debt incurred after you separate but before the official divorce decree is signed is generally still considered community debt. You may need Temporary Orders from the court to protect yourself during this interim period.
Protecting Yourself From Debt During Divorce
Consider refinancing joint credit cards and loans into individual names as soon as possible. If refinancing isn’t possible, work with your family law attorney to include indemnity clauses in your divorce decree. These clauses require your ex-spouse to pay their assigned debt and legally require them to reimburse you if the creditor comes after you.
Do not wait until the divorce is final to manage joint accounts. If possible, freeze or close joint credit cards immediately upon separation to prevent new charges from being added to the community estate.
Common Mistakes to Avoid
Many people make costly errors when handling debt in divorce. The biggest mistake is assuming your divorce decree controls what creditors can do. Creditors are not bound by your divorce order and can pursue either spouse for payment on joint debts, regardless of what the judge decided.
Another common error is failing to refinance joint accounts before the divorce finalizes. If your ex-spouse’s name remains on a credit card or loan, they can damage your credit by missing payments or running up balances. Not documenting separate debt is also risky—without proof, courts may treat it as community property.
Finally, don’t ignore the impact on your credit report. Even if the court assigns a debt to your ex-spouse, if their name is still on the account with you, their missed payments hurt your credit score and your ability to borrow money in the future.
Frequently Asked Questions
Is all debt split 50/50 in a Texas divorce?
No. Texas courts use the “just and right” standard, which allows judges to divide debt fairly based on your specific situation. This may result in an unequal split if one spouse has significantly higher income or if other factors make an unequal division more appropriate. Learn more about how Texas courts divide property.
What if my spouse incurred debt without my knowledge?
Community property laws may still hold you liable for debt your spouse took on during marriage, even if you didn’t know about it or didn’t benefit from it. However, there are exceptions. If your spouse committed fraud or the debt was for their separate benefit (like an affair), courts may assign it differently. This is why having an experienced family law attorney is important.
Can I be held responsible for my spouse’s debt after divorce?
If the debt is in both names, creditors can pursue you even after divorce. This is why refinancing joint accounts before the divorce is final is so important. If your ex-spouse fails to pay debt assigned to them in the divorce decree, you may need to go back to court to enforce the order or pay the debt yourself to protect your credit.
How do student loans get divided in a Texas divorce?
Student loans taken out before the marriage are separate debt and remain with that spouse. However, loans taken out during the marriage are generally considered community debt, even if only one spouse went to school.
That said, Texas courts often award the debt to the spouse who received the education, as they are the one benefiting from the degree’s earning power. If community funds were used to pay down a spouse’s separate student loans (incurred before marriage), the other spouse might be eligible for a reimbursement claim.
What happens if my spouse doesn’t pay their assigned debt?
If your ex-spouse fails to pay debt the court assigned to them, you generally cannot have them held in contempt of court (jailed), as the Texas Constitution prohibits imprisonment for debt.
However, you can file a motion for enforcement to ask the court for a money judgment against your ex-spouse for the damages you suffered. This is where an indemnity clause in your decree is vital—it clarifies that your ex-spouse must reimburse you for any payments you are forced to make to protect your own credit.
Get Help Dividing Debt in Your Texas Divorce
Dividing debt in a Texas divorce requires careful planning and a clear understanding of community property law. The decisions you make now affect your financial health for years to come. Adams Law Firm helps Houston families protect their interests during debt division. Our team works to identify all debts, challenge unfair assignments, and negotiate settlements that give you a fresh financial start.
Don’t navigate this alone. Call (281) 391-9237 today to schedule a consultation with Adams Law Firm and learn how we can help you divide debt fairly in your Texas divorce.
