Divorce, Debt, and Finances

Tips, Struggles and Successes navigating Divorce, Debt and Finances

Are you still responsible? Debt after divorce

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You have a divorce agreement, it clearly states you are responsible for three of your joint credit card accounts and your ex is responsible for the other three, case closed, right?

Are you still responsible? Debt after divorceUnfortunately, this is not always the case despite your divorce agreement if the accounts are joint you are still on the hook if your ex doesn't pay. So when your vengeful or irresponsible ex decides to default, you risk a damaged credit rating and the continuous calls from debt collectors.

Protect yourself

Oftentimes we are unaware our ex has failed to pay on joint debt until we get a call from a debt collector or denied for a loan because our accounts are past due. By keeping a careful eye on your credit report you can avoid unpleasant surprises. Ideally your attorney would advise you to do this, but many couples today are splitting up on their own without attorney involvement and are unaware of the ramifications caused by their ex's failure to pay.

Do your due diligence

By closing or freezing joint accounts before more damage is done you can avoid having your ex charge up these accounts further.

  • Know your debt. Be sure to account for any and all joint or authorized user accounts. Include all personal loans, major credit cards, and the store accounts you may have opened years ago, if still open they could pose a threat to your credit rating through your ex's decision to charge up or not pay on the accounts.
  • Pull your credit. By pulling your credit from all three credit reporting agencies you can see all of your accounts, opened and closed. Carefully review all of the accounts so you are prepared to make the necessary calls to close, freeze, or remove the authorized user on the accounts.

Contact your creditors

While closing the accounts sounds easy enough you may have trouble doing so on any that still carry a balance.

  • Freeze or transfer the balance.  You may have to settle for freezing them or transferring the balance to a different account in your name alone until the balance is paid off.
  • Make smart choices.  Be careful when closing accounts as a sudden surge in opening or closing accounts may affect your credit rating.
  • Keep checking your credit.  Continue to check your credit report over the next year or so to make sure any accounts you closed show closed at your request, and that no additional charges have been made on the frozen accounts.

Keep paying the bills

Divorce proceedings can sometimes be lengthy. Continue paying on all the accounts your name is attached to.

  • Minimum payments.  Even if you can only pay the minimums make sure to keep them up to date.
  • Make up for your ex.  If your divorce is final and you find your ex isn't' paying you may need to pay at least the minimum payments on the accounts to avoid damaging your credit rating.

The bottom line is that your creditors don't care what your divorce agreement says; if your name is on the account you are financially responsible.

Suzanne Cramer

Suzanne is a certified credit counselor for CareOne Debt Relief Services and is a Social Media Specialist. Suzanne supports our Ask the Expert forums as a coach and writes for our A Straight Talk on Debt and Divorce, Debt and Finances blogs. You can also follow Suzanne on Twitter where she shares the latest debt industry news, and tips to keep your finances in check with her @AskCareOne and @ADivorcedMom accounts.

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  • Aside from the life lessons I've also learned some important money lessons that have shaped and will continue to affect my financial life.

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