Divorce and Credit Card Debt: 5 Steps to Protect Your Credit

Paying off debt that your spouse accumulated during the marriage just makes divorce more agonizing. Joint accounts are typical in marriages, and after a divorce, the only thing a creditor can see is that you promised to pay back the obligation. Your marriage’s divorce does not invalidate that understanding. So what are your options if you don’t want to pay the debt that your spouse has accrued?

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  1. Transfer the balances to individual accounts and close the combined accounts. Obviously, if the divorce is amicable, this will be a lot simpler. However, this can also be done with a mediator who is often far less expensive than a lawyer during the separation phase prior to the start of divorce proceedings. Once the amounts have been moved to separate accounts, the joint accounts can be closed. A mediator can assist with dividing the outstanding debt. This is particularly beneficial in preventing vengeful divorce games when spouses may attempt to rack up joint credit cards with insane shopping sprees during a to get back at one another.
  2. Put your name on the joint accounts and close them. This tactic can stop a vengeful spouse from adding further debt to the joint credit cards. Make sure the court is informed of your actions so that the debt may be correctly apportioned during equitable distribution, one of the final stages of the divorce process.
  3. Before the divorce is finalized, pay off the debt. If your debt is modest, the quickest solution might be to simply pay it off, close the joint accounts, and release one another from debt-related obligations. One of the preferable ways to accomplish this is to pay off the obligations using common assets, like a joint savings account. Once more, it can be simpler to say than to accomplish, and many people aren’t in a position where a speedy payoff is financially feasible.
  4. Declaring bankruptcy Creditors cannot pursue either partner if the debt load is too heavy and both partners agree to file at the same time. If only one spouse files, however, creditors may pursue the other spouse to recoup the debt. However, this is an expensive strategy that could ruin your credit score for years.
  5. Smile and endure. So be it if you’re given the bulk of the debt. Pay the bill down on time to safeguard your credit. Although you are not legally required to pay the debt if your ex is given the majority of the responsibility, you should be aware that this could damage both your credit and theirs. One strategy is to just pay the debt. Continue making your payments, but then bring your husband back to court to request that the judge reimburse you for the fees you have already paid.

State regulations should also be taken into consideration when deciding how to manage your combined credit card debt since some jurisdictions, known as community property states, make both parties accountable for joint debt, even if the accounts were in individual names. For guidance on which approach might be most effective in your situation, consult your attorney or mediator.

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