Currently in separation mode & dividing assets/debts. I inherited a truck when my dad died free & clear. After getting the truck I used it as collateral for a vehicle loan = $25K. My understanding is the truck is off the table as an asset but the debt could still be on the table as a 50/50 split, due to the fact that the debt was obtained when I was married and the money from the loan was used to maintain our lifestyle and not to purchase the vehicle.
If this is correct can you direct me to some statute that addresses this situation?..or is it left up to the Judges discretion?
The truck is your separate property since it was an inheritance. It is therefore not subject to being divided in equitable distribution.
The loan is marital debt since it was acquired during the marriage (between the date of marriage and date of separation) as long as the loan was for the joint benefit of the marriage. Most debt is for the joint benefit of the marriage and it sounds like this applies to your situation as well since the funds were used to support the lifestyle of the marriage. The loan would be subject to being divided in equitable distribution.
N.C.G.S. 50-20 and numerous case law opinions address equitable distribution.
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