November 2, 2015

3 Ways Marriage Equality Effects Debt Practices

This summer’s Supreme Court ruling to legalize same-sex marriage was life-changing for many people, and the ripple effects of the decision have yet to be realized in their entirety. New changes to debt collection law have come into play almost immediately following the ruling, and in reference to the past provisions made by states in which same-sex marriage had already been legalized. Here are three major ways that I see the ruling of Obergefell v. Hodges having a lasting impact on the process of debt collecting today.

  1. Spousal Communications

Since 2014, the Consumer Financial Protection Bureau has recognized same-sex couples the same way as heterosexual couples for states where the marriages were legally recognized. Their protections were extended to all “statutes, regulations, and policies enforced, administered, or interpreted by the CFPB…including the FDCPA, Equal Credit Opportunity Act, Truth in Lending Act, and Real Estate Settlement Procedures Act.”

This is particularly relevant in terms of spousal communications procedure. The ruling means that debt collectors will now be able to speak to same-sex spouses about their partner’s debts, the same as they had previously been permitted to discuss debts with couples in a heterosexual pairing. This was established under the Fair Debt Collection Practices Act, which allows collectors to talk about the delinquent debts with the person who accrued it, and their legal spouse. With Obergefell v. Hodges, this grouping of people is expected to grow exponentially.

  1. Community Property Law

Nine states across the country have some form of community property law, which essentially means that both spouses in a marriage are responsible for all assets and liabilities incurred during a marriage, even if it was the primary responsibility of one spouse. These states are Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, and Wisconsin. Now in these states, as well as any others which may adopt community property laws, same-sex spouses will also be responsible for the debts and liabilities of their spouse, which is equal to heterosexual couples.

  1. Medical Debts

One of the most passionate topics during the fight for marriage equality was questions of medical rights for same-sex spouses, and with the new Supreme Court ruling, the medical requirements for legal marriages will also fall to these parties as well. Under the doctrine of necessaries, a husband is required to provide for necessary costs incurred by a wife, including housing, sustenance, and medical needs. This husband and wife specific language has also been expanded in multiple states to include the wife additionally providing for her husbands ‘necessaries’, and  will then naturally be applied to those states to also include same-sex couples. This extends to medical debts, and can have a long-reaching impact on the payment of medical bills.

With the changes to marriage law so fresh, there are still opportunities for individual states to implement their interpretations differently. It remains to be seen the full impact of Obergefell v. Hodges, but the effects will surely be numerous and long lasting. If you are in need of an experienced attorney for these or any similar issues, I can offer a free consultation. Call me, Michael Alan Siddons, at 610-255-7500 today to learn how I can help.