In Arizona, How Does The Court Split Business Debt In Divorce?
If you are in the process of divorce in Arizona, you may be wondering how a court will divide business debt. This article discusses the division and treatment of debts that arise from your individual business endeavors.
The Court has jurisdiction over any litigation related to debts incurred by either party during the marriage. Under Arizona law, if there is more than one creditor who claims an interest in a particular debt, then there must be either a voluntary agreement among all creditors or an order issued by the Court for distribution of those funds to each creditor according to their respective interests. Creditors with competing interests cannot pursue payment from either spouse until they have obtained a judgment against one or both spouses and received notice of the marital dissolution proceeding so that they can assert their rights. This is beneficial for the following reasons:
- Makes it easy to know how payments will be allocated according to their respective interests
- Prevents any creditors from requesting payment without notice and can result in a judgment against one or both spouses
- Ensures creditor rights are protected
- Orderly distribution of marital property
- Secured a more organized and fair way to handle debt
- Protects you from lawsuits filed by creditors without notice
- Avoid any legal complications when finalizing your divorce
Divorce is never easy, but it can be even more stressful when you think about who gets what in your settlement. When going through a divorce and dividing up debt too, there are other considerations such as the interest rates on each individual’s loan or how long they’ve been paying for their car loans. Knowing these considerations will enable you to:
- Get peace of mind after your divorce is final and you know who gets what
- Save time by getting the division process done as quickly and easily as possible
- Compare how much each partner has to offer in a settlement which can help make it easier
- Help find solutions to other financial issues such as debt with one easy tool
Divorce may seem like an overwhelming process to go through just by itself; however, with all of the different types of debts that spouses share together, things get really tricky! It could mean figuring out which spouse pays off high-interest credit cards while one starts over from scratch bank account wise after years of marriage expenses piling up.
When a married couple divorces, there is one more thing they must consider and that’s the business. If it was created as a joint venture or for-profit during the marriage then whichever spouse receives it will be responsible for any debt that has accumulated while running it up until now. The divorced spouses have to divide all marital assets according to state law so this means if you’re awarded your ex-spouse’s share of company stock in their name, which includes an ownership interest in an enterprise with preexisting debts owed by both partners, you’ll need to take on responsibility not only for those profits but also these existing obligations too!
If you are in the process of divorce in Arizona and would like more information about how a court will deal with your individual business endeavors, contact us today! Our experienced team can help you navigate these complex issues.
Are You Looking for a Family Law Attorney Skilled in the Distribution of Property and Division of Debt in a Divorce?
The attorneys at GillespieShields are well-versed in a variety of different legal fields, ranging from family law to civil suits, employment disputes, and probate cases. Although we specialize in several areas of practice, our greatest passion is family law. In Arizona, married couples are required to divide property upon divorce. All property acquired during the marriage will be divided equally between both parties; it is known as community property in this state and applies to all types of possessions (both tangible and intangible), real estate, income, or debts that exist at the time of divorce. This can make dividing marital assets a daunting task if not done correctly from day one because there are certain rules which must be adhered to! During our private, one-on-one consultation, we’ll take the necessary time to answer any and all of our questions surrounding Arizona’s family laws, your family’s unique situation, and the possible court outcomes. Contact us today for your consultation!
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