Frequently Asked Questions
- I am going through a divorce. Am I responsible for debts my spouse incurred before we got married?
- Am I responsible for debts my ex-spouse incurred individually but while we were married?
- If I declare bankruptcy, do I still have to keep sending my ex-spouse child or spousal support payments?
- My lender is foreclosing on my house. Does this mean I will lose my home?
Q: I am going through a divorce. Am I responsible for debts my spouse incurred before we got married?
A: Arizona is one of nine community property states. Under standard community property law, any assets or debts you incurred before marriage are considered separate property. That means if your spouse had a student loan or ran up credit card debt before you got married, you are not responsible for that debt when you get divorced.
Q: Am I responsible for debts my ex-spouse incurred individually but while we were married?
A: Arizona's status as a community property state means that any debt you acquired during your marriage will be considered community debt, even if your spouse incurred a debt without you knowing. This means that the creditor can seek repayment from either spouse. Getting a final divorce decree does not protect your credit, and it does not absolve you of any debts you and your spouse incurred while you were married. Arizona law requires family court judges to divide property and debts "equitably." If you believe that your ex-spouse maliciously or intentionally incurred debt in your name without your knowledge, you should contact a lawyer as soon as possible.
Q: If I declare bankruptcy, do I still have to keep sending my ex-spouse child or spousal support payments?
A: In short, yes. Payments made to your ex-spouse or the legal guardian of your child for child or spousal support that was ordered in your divorce settlement agreement is considered "non-dischargeable." That means that even if you declare Chapter 7 bankruptcy, you are still obligated to make these payments.
Q: My lender is foreclosing on my house. Does this mean I will lose my home?
A: Without knowing the facts of your case, it is hard to say exactly what will happen in any particular situation; however, chances are good that you have other options available to you. An attorney who is experienced in real estate foreclosure and who understands the mortgage industry can explain your options so that you can avoid losing your home to repossession or a foreclosure sale. You likely have several options available, such as modifying or refinancing your loan.
In some cases, your lender may have violated the Truth in Lending Act, which requires lenders to disclose certain provisions of their mortgages in a clear and conspicuous manner. The Truth in Lending Act, or TILA, was designed to protect consumers from predatory lenders. Many lenders, particularly with respect to adjustable rate mortgages (ARMs), failed to comply with the disclosures of actual interest rates and payments. If a lender is found to have violated certain aspects of TILA, the borrower may be able to invalidate the entire loan under a type of relief called "rescission".
If you have any further questions about bankruptcy and foreclosure, contact The Law Office of James Portman Webster to schedule a free initial consultation.
