Generally, cars acquired during the marriage are considered a “marital asset” and subject to equitable distribution. Determining how to divide two (or more) cars during a divorce is a straightforward process. In most divorces, each party typically keeps the car that he or she drives.
Interestingly, a leased car does not have value and it is not a “marital asset.” Rather, a leased car is considered a liability. If the car is not leased, and assuming that the loan payments are less than the value of the car, then the car is considered to be an asset. The value of the car is usually determined by using a trusted used car guide, such as Kelley Blue Book, which is available online.
If both cars are approximately equal in value, each party may agree to retain their own car and there would be no equalization. However, if there is a disparity in values between the cars, then the parties may agree to an equalization of the values. The party retaining the car with the lesser value would accept payment (or a credit) for his or her half of the difference in the values. Another alternative is to have the party keeping the car with the greater value assume additional marital debt.
Finally, it is important to remember that you must change the title and insurance on a car to transfer ownership after the entry of the Judgment of Divorce.
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