A central concept in New Mexico family law is that the way property is titled does not necessarily dictate who owns it, at least where spouses are concerned. This can be a difficult concept to come to terms with. Often, people understand it, but they don’t want to believe it.
In a New Mexico dissolution proceeding, the court must determine how to divide the debt of the spouses. This generally requires the court to do three things: identify all debts, classify the debts, and divide the debts.
New Mexico is one of only a few states that follows the law of community property. In general, this means that when either spouse acquires property during the marriage, that property is presumed to be community property. Community property laws apply to real property, such as land and houses thereon, as well as personal property, such as cars and home furnishings.
When a marriage ends, one of the first and foremost questions people have is “who gets what?” In a New Mexico dissolution proceeding, one of the primary tasks of the court is the division of the couple’s property. This task can be made much more difficult if community and separate property have been mixed. This is known as “transmutation.” “Transmutation” is just a fancy way of saying that something has been transformed or changed.
This sounds pretty simple, but, as the saying goes, "the devil is in the details." The presumption of the law is that any assets acquired belong to both.