This blog article is a continuation of some things that I recommend a spouse consider during the marriage. As I mentioned in the last blog, these are suggestions that one cannot do, or change, after issues come up in the marriage and the parties separate (of course, that may not be true if the marriage does, in fact, continue).
Bills In Both Names – There is no legal requirement that a bill, created during a marriage, needs to be in both spouses names. And this is one of those situations where, depending on what kind of bill it is, it may or may not be good that it is in both spouses names. Some examples may be useful. As a general rule I believe it is appropriate to have both spouses on the title to a home and the mortgage. Keeping track of what the status of a mortgage, or even a car loan, can be a lot easier if both spouses are on the loan/promissory note. I have see situations where a client was driving a car, but the loan was only in the name of the other (uncooperative) spouse – it was very difficult to work with the bank on changing the loan and the name on the title via the bank. This is less of a problem if one “knew” that a particular asset was going to go to a particular spouse in a divorce – this may be easy to figure out, in advance, for something like cars. Credit cards can be one situation where each spouse having only cards in his/her name can be good, especially if one of the spouses has a “problem” in over using the card. The easiest debt situations involve responsible spouses with roughly equal amounts of credit card debts in each parties names (everything else being equal). Even in these situations, it is important to see if there is any credit card debt that is associated with a particular asset that will be awarded to one of the parties – in this situation it may be appropriate to make that spouse solely response for the debt (i.e. no longer a community debt that should be divided) – also, it may be appropriate to factor in this debt when placing a value on the asset. While I do not want to discourage placing both spouses names on a home mortgage, this can be an issue, later, for the party who is not taking the family home (in the divorce). Unless that parties name is “removed” from the underlying promissory note to the home, that debt may come into play should the party ever wish to purchase a new home (the reason for this is based on the fact that even if the divorce decree says only one spouse is responsible for the debt (the one keeping the home) this court order is not binding on the bank holding that debt. When the other (now ex) spouse goes to get a new loan, the new bank will know that it is possible that should the ex making the payments on the mortgage quit, then the bank with the mortgage could come after the other (ex) spouse. These are issues that should be fully discussed with your family law attorney.
Assets In Both Names – Similar to debts, there is no legal requirement that assets be placed in the names of both spouses, during a marriage in the state of Washington. For the most part this issue will involve the cars and the family home. The cars tend to not be a problem, if they are only in the name of one spouse because, as a general rule, it is in the name of the spouse who is driving the car, will keep the car after the divorce, and will be making the payments on any loan associated with it (if this is not the case, the title can be changed, but problems can come up to change a loan). For the most part I see most married couples place the family home in the names of both parties, along with the associated debt. I suspect many/most banks want to see it happen this way and putting aside the issue of post responsible for the debt after the divorce, this works out best in most situations. Of course when it comes to a potentially valuable asset of the marriage figuring out how to divide the equity can be a problem (depending on what other assets can be offset against a spouses interest). Another issue that can come up, with a home, is who can really afford it, post divorce. In the world we live in today, many couples survive on two monthly incomes. When you remove one, that nice house may be too much for either party to afford.
This blog article is not intended to convey legal advice, but only address some of the general rules. Most legal issues, in family law cases, depend on the specific facts. Should you wish to discuss your particular situation with the Law Office of Thomas A. Chillquist, please call or email my office. I am a family law lawyer (divorce attorney) and I represent parties in family law, and divorce, matters in King and Pierce County, Washington, including Kent, Federal Way, Covington, Renton, SeaTac, Des Moines, Fife, Auburn, Seattle, Bellevue, Puyallup, Orting, Tacoma and Mercer Island. Copyright Thomas A. Chillquist