New Mexico Divorce: Division of Property and Debt

In a New Mexico divorce, there is a rebuttable presumption that all property that is acquired during marriage, with the exception of inheritances and gifts, is community property and is therefore subject to an equal division between the parties. This is assumed, irrespective of in whose name the community property is titled.

Along with a house, cars, and furnishings, community property can include the following types of property:

  • Receivables earned during marriage but due to be paid after divorce;
  • lost wages due to an accident;
  • improvements made on separate property that were funded with community money or performed by either spouse that increased the value of the property;
  • retirement accounts;
  • bank accounts;
  • pensions; and
  • life insurance.

Separate property typically includes:

  • an inheritance;
  • pain and suffering damages resulting from an accident;
  • property acquired before marriage; and
  • gifts from one spouse to another if it was the actual intent for it to be a gift.

When Separate Property Becomes Community Property

However, separate property becomes community property in New Mexico when it is commingled with community property and is unable to be traced.

For example, an inheritance received by one spouse which would normally be treated as separate property will likely be considered community property if the inheritance money were deposited into a joint checking account held with the other spouse or if those funds were used to pay marital bills.

Dividing Debt

Further, property is more than just a tangible asset. For purposes of a divorce settlement, property also includes the debt that needs to be divided.

All debts that occurred during the marriage are presumed to be “for the benefit” of the community and are thus community debts. Necessarily, there may also be some debt that is separate debt, as in the case where the debt originated from a separate property purchase or encumbrance so long as the purchase was not commingled with community property.

Because community debts are owed by both spouses, creditors may satisfy debt from all community property. Just as in the case of assets, community debts are also equally divided between the parties.

Effect of Marital Misconduct on Property Division in New Mexico

Because emotions run high during a divorce, one or both spouses may blame the misconduct of the other spouse for the break up of the marriage, causing him or her to argue that they are entitled to a greater percentage of the assets or a smaller percentage of the debt because the other spouse “was the one who broke up the marriage” or “was the one who did wrong.”

Just as in the case of establishing grounds for a divorce, fault and misconduct are not considered in the division of community property.

Some of the most drawn-out and most volatile divorces arise when one or both parties are unable to accept the fact, although it may seem unfair, that the wrongdoing of the other spouse will not dictate the division of your community property.

New Mexico Divorce Lawyer

If you are a man facing divorce in New Mexico, you should contact a New Mexico divorce lawyer to ensure your rights are protected. Cordell & Cordell Albuquerque divorce lawyers are licensed to practice throughout the state and are available for consultations should you seek additional information or possible legal representation. Please call 1-866-DADS-LAW or 505-767-7200 to schedule an appointment.