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Articles Posted in Debt

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mock-credit-card-1-1204846-300x196By:  Sarah T. McCain

In every Colorado divorce proceeding, the court will require each party to complete and file a Sworn Financial Statement.  This requirement regarding financial disclosures in a divorce comes from C.R.C.P. Rule 16.2. Among the variety of items that you are required to list on that SFS is debt, including both marital and separate debt items. This includes, but is not limited to, credit cards, student loans, outstanding tax obligations, and medical obligations. On this document, it is important to list all of your debt so that the court is able to properly divide all of the marital debt that has been incurred during the marriage. One question that attorneys get in these cases is whether the debt is joint marital debt which should, thus, be divided. It is a common question and one that is derived from a common misconception that if the debt is not in your name, it is not marital. This is not the case in most situations. 

There are some debts that do follow this standard for the most part. Specifically, student loans are generally something that go with the party who incurred the loan for the purpose of their education. The student is usually the one that is benefitting from the education and thus, the debt goes with them. Of course, nothing is so black and white. There are circumstances when a student loan can be divided as marital debt. When a student loan obligation is incurred during the marriage, the court does have the authority to divided the student loan obligation between the parties.  In doing its analysis, the court may look at things like whether proceeds from the loan were used for marital expenses, such as mortgage or utilities.  A court might also consider whether that loan ultimately benefits both parties financially in that the loan may have led to a degree, which led to a better job, which may impact the spousal support or alimony the other party pays or receives.   Therefore, though the norm might be to have the person incurring the student loan be responsible for paying it, courts can divide student loan debt and may do so in certain circumstances. Continue reading

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Colorado law allows a trial court to order one party to a divorce to pay for the other party’s attorney’s fees. C.R.S. 14-10-119. The court must take both parties’ financial resources into account, including both the amount available to one party and the amount needed by the other, in determining the amount of the order. The statute is silent, however, on the time period, or point in time, that the court should consider in determining an amount. The Colorado Court of Appeals recently considered this issue in a case where the trial court held separate hearings on permanent orders and attorney’s fees about six months apart. In re the Marriage of de Koning, No. 12CA2334, slip op. (Col. App., Jan. 2, 2014). The parties disagreed on which hearing date the court should use in considering the amount of financial resources.
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The first part of this discussion on bankruptcy gave an overview of the bankruptcy process and how it applied to couples who were still married. The second part will discuss the impact of bankruptcy when a couple separates or divorces.

What Happens If a Couple Separates?

In some respects, if a couple separates but remains married, the effect of one spouse filing for bankruptcy is not much different than if they lived together. Assuming the debtor spouse filed individually, the nonfiling spouse might find that certain marital property was considered part of the bankruptcy estate. While the debtor spouse could wipe away a substantial portion of his or her debts, the nonfiling spouse would still be responsible for his or her separate debts.
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When Denver couples divorce, few anticipate that one of the parties will file for bankruptcy, or that the bankruptcy could have such an impact on both of their lives. That is because there is a lot of confusion about bankruptcy in general: who applies for bankruptcy, what it involves, and its long-term impact.

This blog will look at bankruptcy as it relates to Denver couples who separate and divorce in two parts. The first part will discuss bankruptcy in general, and what happens when one member of a still-married couple files for bankruptcy. The second part will discuss potential problems a couple encounters when they separate and one party files for bankruptcy, or when one party files during or after divorce proceedings.
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As a divorce lawyer in Denver, one of the most common issues I see in child support battles, beyond whether someone is appropriately employed, relates to what does or does not constitute income for child support purposes. With this article, my hope is to clarify some things for my readers regarding the subject. To start, income for child support purposes is generally set forth in C.R.S. 14-10-115(5).

Subsection (5) sets forth a long list of what counts as income. I will dispense with reciting the whole list, but will set forth some of the more commonly misconstrued items, beyond what someone might earn from his or her paid job:
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Denver family law attorneys at Plog & Stein, P.C., are well abreast of the requirements set forth by Colorado statute and the courts related to divorce. One of the most important steps required by the courts relates to financial disclosures. Most people who have had a divorce or child support case will remember the tedious part of the case related to financial disclosures, yet they may not quite understand the importance of them.

Pursuant to Colorado Rules of Civil Procedure, Rule 16.2(e)(2), the basic list of documents to be provided in a divorce or child support case is:
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The attorneys at Plog & Stein, P.C. help many Denver area family law clients come to grips with the concept of what constitutes “marital debt.” Ironically, when looking through the statutory section regarding divorce in Colorado, C.R.S. Title 14, Article 10, or the Uniform Dissolution of Marriage Act, one will find that there is no specific “debt” section. There is a section set aside for just about every other facet of a custody or divorce case, just not one for debt.

Without explanation, those lay people brave enough to try to figure out divorce statute and the meaning of “debt” may be left scratching their heads. In our divorce practice, we view debt almost as negative property in need of division. Setting that aside, definition is also needed. Courts generally view marital debt as debt incurred during the course of the marriage.
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