Mortgage and joint loans in divorce: what to do under Georgian law

What to do

1. Classify each debt: joint debts of the spouses are divided between them in proportion to their shares in the joint property (Civil Code of Georgia, Art. 1169). One spouse's debt: enforcement is directed at that spouse's property and/or their share of the joint property (Civil Code of Georgia, Art. 1170); from the joint property — only if the court establishes that what was received went to the common interests of the family (Civil Code of Georgia, Art. 1170). Prove where the money went.
2. The bank is a third party, and the division does not bind it: the bank may claim the full amount from any co-borrower (Civil Code of Georgia, Art. 465); a transfer of the debt to the other spouse is valid only with the bank's consent (Civil Code of Georgia, Art. 204); a mortgage gives the bank priority over the mortgaged apartment — the division does not remove this (Civil Code of Georgia, Art. 286). Check who is the borrower, co-borrower or guarantor.
3. Apartment with a mortgage: property acquired during the marriage (including an apartment bought with a mortgage) is joint, unless the marriage contract says otherwise (Civil Code of Georgia, Art. 1158); shares are equal unless agreed otherwise (Civil Code of Georgia, Art. 1168). It is divided together with the debt; a division that affects the rights of a third party (the bank) is not decided together with the divorce (Civil Code of Georgia, Art. 1130). In practice — re-register the loan in one name with the bank's consent, with compensation to the other spouse.
4. Payments after separation: a spouse who has paid a joint and several debt may claim from the others their share (equal by default) (Civil Code of Georgia, Art. 473); property bought during actual separate residence may be recognised by the court as personal (Civil Code of Georgia, Art. 1168).
5. Deadlines and risks: the limitation period for claims for division after divorce is 3 years (Civil Code of Georgia, Art. 1171). One spouse's transaction involving joint property cannot be challenged merely because the other spouse did not know of it or did not consent to it (Civil Code of Georgia, Art. 1160).
6. Where to apply: district (city) court; bank — re-registration or restructuring of the loan.
7. Evidence: the loan or mortgage agreement (borrowers, guarantors), the registry extract, payment statements (whose money, and when), where the loan was spent, the date of actual separation.
8. Pitfalls: an agreement that “the husband pays the loan” does not bind the bank; a loan in one person's name does not automatically become joint; failing to keep proof of payments made after separation.

Be sure to check

• joint debts are divided in proportion to shares; one spouse's debt — from their property or share; a joint debt — from the joint property only if the money went to family needs
• the bank is not bound by the division — a transfer of the debt requires its consent; the bank may claim the full amount from any co-borrower
• a mortgaged apartment bought during marriage is joint; a division affecting the bank's rights is not decided together with the divorce
• recovery for payments made by one spouse; the 3-year limitation period for division