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Community property states, like California, have rules governing marital property and debts.
Basically, community property is all property acquired during marrage while a couple is living together.
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What about student loans owed by both spouses for the education of one spouse? Obviously, education acquired by one spouse during marrage is not a tangible asset. But I do not have the expertise to fix anything on a modern automobile.
Yet California divorce courts routinely order reimbursement to the other spouse for community funds that went to pay for the other spouse’s schooling.
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Community property in bankruptcy can not be liquidated to pay a person’s seperate debts. As Yogi Bera famously said, “Don’t confuse me with the facts.” For example, a couple might be living apart temporarily for purposes of work, or school.
Are new assets and new debts community or seperate? During a divorce, the Family Court will divide up responcibility to pay community debts.
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