When couples in North Carolina face separation, one of the most pressing concerns is how their property will be divided. This concern is pronounced when a divorcing couple doesn’t have significant assets—no house, limited savings, maybe a car or some household items.
Many people think that only high-net-worth divorces are complicated, but the truth is that even low-asset divorces come with important legal and financial decisions. Understanding how property division works in the Tar Heel State is essential, even when there’s not much to divide.
North Carolina’s approach to property division
Couples divorcing in the Tar Heel State should expect an equitable distribution of their marital assets. Courts strive to arrive at a fair rather than 50/50 distribution of assets by considering the following factors:
- How long the couple was married
- How each spouse financially contributed to the marriage
- How each spouse’s debt affected the couple’s overall financial standing
Even if a couple doesn’t own real estate or stock portfolios, items like vehicles, furniture, tax refunds and retirement accounts can still be subject to division. Debts such as credit card balances or loans taken during the marriage also count in the property division process and can become sticking points when there’s little to offset them.
What counts as marital vs. separate property?
During asset division, not all property is up for grabs. Marital property includes assets and debts acquired during the marriage, while separate property belongs to one spouse individually. In low-asset divorces, separating what belongs to whom can still become contentious.
For example, if one spouse used separate funds to buy a vehicle that was later used by both, that vehicle may be partly considered marital property. Things get especially layered if there’s an overlap between separate and marital finances.
When there’s little to divide
In cases where the couple owns few assets and has minimal income, the focus often shifts to managing debt and helping to ensure both parties can remain financially stable post-divorce. The court may prioritize dividing the debts fairly and helping to ensure that neither party is unfairly burdened. For instance, if one spouse has significantly more earning potential, they might be assigned a greater portion of joint debts.
Dividing property in a North Carolina divorce isn’t just about who gets the house or the big-ticket items. Decisions can still impact a couple’s financial recovery and peace of mind, even with limited assets. In low-asset divorces, smart strategy and legal guidance can make all the difference in starting the next chapter on stable ground.
