Is New Mexico an Equitable Distribution State?

Community Property vs. Equitable Distribution – Is New Mexico a Community Property State?

The concept of community property is that all marital assets should be divided equally (50/50) in a divorce, and in some cases, this is a fairly straightforward process. If you have $10,000 in a savings account, for instance, each party gets $5,000.

But in the real world, not every asset distribution is this simple.

Sometimes a couple owns a property that both spouses want to keep, but neither wants to sell and split the profits. Other times the couple may agree to sell their house but disagree about who keeps what pieces of furniture, electronics, and housewares inside it.

Is New Mexico a 50/50 Divorce State?

Under community property laws, a judge strives to divide property evenly.  The courts have some leeway to vary on an exact 50/50 split for equitable reasons.

This doesn’t mean you can expect to take everything in the divorce or claim all of what you consider to be the “best” of your assets.

The judge will try to find a fair and reasonable way to divide your assets (and debts). However, some people end up disappointed with what they did or didn’t get in the divorce, which is why many couples try to agree on asset distribution in mediation.

The best way to approach asset distribution is to list all marital assets and debts, which you will need when you meet with an Albuquerque divorce attorney. Consider which assets are most important to keep and which you are comfortable giving up.

If you have debts, this is also an opportunity to negotiate. For example, if you are set on keeping many of the assets, you might offer to take on more than half of the debt to make things fairer for your spouse.

How Do You Prove an Asset Is Separate and Not Community Property?

If you believe some of your assets are non-marital and belong only to you, speak with your attorney about how to prove this in court. They will ask you how and when you acquired the assets and attempt to gather evidence to indicate they are only yours.

In general, New Mexico has the following rules for determining what is and isn’t community property:

• New Mexico usually considers assets acquired by one spouse before the marriage or after the divorce is final as separate. For instance, if you owned your car before marriage, it should remain your separate property and not a marital asset.
• If there is legal documentation that a property is separate, it will be treated this way. If you have titles, deeds, or court judgments for the property you believe is separate, ask your attorney to review them to see if they meet the qualifications.
• When one spouse receives a gift or inheritance from a family member or friend, this is usually treated as separate property. Sometimes, you may need to prove that the giver intended the gift only for you.
• Debt can also be considered separate, and as with assets, any debts taken on by one spouse before marriage or after the divorce are considered separate debts.
  This rule means that if your spouse acquired student loan debt before marriage, you would not be expected to pay half of it.
• Similarly, community debt should not include any debt designated as separate by a court decree or other documentation.
• If your spouse wrote to a creditor that the debt was separate when they incurred it, then it should be treated as separate.
• Sometimes one spouse may have debt from a tort or personal injury case.
  For instance, if your spouse was at fault in a car accident and their auto insurance didn’t cover all the other party’s damages, the court may have issued a judgment that they pay the remaining damages.
  If the accident happened before your marriage, this debt should not be treated as community debt.
• New Mexico law carves out an exception for gambling debt – if your spouse racked up debt due to a gambling habit, that is separate debt.
• In some cases, one spouse may take on debt while living separately from their spouse, even if the couple is not legally separated and hasn’t filed for divorce.
  If this debt only benefits the spouse who took it on, not their marriage partner, children, or the family, it will be considered separate debt.
• Occasionally a judge may declare a debt separate because it is unreasonable to and incurred after the parties separated.

What if Your Spouse Refuses to Agree on a Fair Breakdown of Assets and Debts?

Continuing to argue with your spouse is not likely to be beneficial and may make things worse. Speak with your divorce attorney about what you think is an equitable distribution of assets and liabilities, and they will do their best to serve your interests.

While they may not be able to get everything you want, they will work to meet as many of your wishes as possible.

Sometimes, spouses who refuse to budge on issues such as who gets the house may change their minds after we begin negotiations with their attorneys.

Depending on the situation, we may point out that letting the court decide is unlikely to produce the result they want. Or we might find a way to incentivize the other spouse by offering them other assets in exchange for the ones you care about most.

Additionally, it’s helpful to remember that sometimes arguing with a soon-to-be-ex-spouse can make one or both parties more stubborn.

In many cases, when we make an offer to the other party’s attorney and they explain it to the client, the other party is more willing to listen and consider it seriously.

In some situations, the other party might even be willing to negotiate an arrangement similar to the one their spouse proposed earlier.