Cars are an important asset, and are often the subject of dispute in a divorce—whether the couple owns or leases one car or multiple cars. Because cars are property and often purchased or leased with marital assets (funds), they are subject to the court’s decisions on how to divide the property. If the parties to a divorce are not able to agree on the transfer of ownership (title) and responsibility for payment of any car loans and insurance, the judge or jury may make these decisions for the parties.
In Texas, which is a community property state, assets acquired during the marriage, including cars, are generally considered community property and are subject to division upon divorce. This means that both owned and leased vehicles can be divided between the spouses. If the couple cannot reach an agreement on their own regarding who gets which vehicle, the responsibility for any remaining car loans, and the handling of insurance, the court will step in to make these decisions. The court aims to divide the property in a way that is 'just and right,' considering factors such as each spouse's earning potential, fault in the dissolution of the marriage, and the best interest of any children involved. The division does not necessarily have to be equal, but it should be equitable. If one spouse is awarded a car, that spouse will typically be responsible for the associated debts, such as the car loan and insurance payments. It's important to note that any vehicles acquired before the marriage or received as a gift or inheritance may be considered separate property and not subject to division.
