Of all the different aspects of a divorce case that Maryland residents go through, the property and debt division part is the one that will likely have the most consequential impact on finances going forward.
Most married couples spend years – if not decades – accumulating assets, such as the family home, retirement accounts and vehicles, while also managing various debt burdens, such as a mortgage, car loans and student and health debt, for example.
Untangling those assets and debts during the divorce process can be complicated. But, the end result can also set the stage for each spouse’s financial health moving forward in post-divorce life.
The key starting point in the property division process is to determine which property should be categorized as “marital” and which might be “separate.” The difference is crucial.
Marital property
“Marital” property is generally defined as all of the property that the married couple has accumulated during the course of the marriage years – oftentimes regardless of who purchased the property or started the account in question, for instance.
Any asset classified as “marital” property will almost always be part of the property division process.
Separate property
“Separate” property, on the other hand, is usually defined as property that one spouse or the other owned before the marriage took place.
Each person enters into a marriage with their own assets – even though for younger couples who get married early in life those assets may not amount to much.
However, older couples getting married or second or subsequent marriages oftentimes see people coming into a marriage with significant assets.
Those assets, if kept separate as they were before the marriage, or perhaps if defined as “separate” by a prenuptial agreement, typically are not subject to the property division process.