It is no secret that divorce has become more prevalent in society. Many people have asked and wondered how to handle outstanding credit card debt after a divorce. Whatever reason for a couple divorcing, they are always credit card debts and other financial matters to be settled. So, how are credit matters supposed to be handled when a couple gets divorced?
Divorce can be messy, but there are neat guidelines that tell you which credit card debts you are responsible for, which can be handled by your former spouse, and which credit card debts you must share even after you’re separated.
Which Credit Card Debts Am I Responsible For Once I’m Divorced?
Because credit card companies are in business to make money, they need to make sure that someone pays outstanding balances on their credit cards.
If you and your former spouse have credit debt, the financial burden usually lies with the person who opened the specific credit card account. While most couples open accounts separately, many open join accounts. The rules on joint accounts vary by state, but in most cases, marital debt includes any debt incurred during the marriage regardless of whose name actually appears on the title. So for joint accounts, whatever credit card debt that you built up while still married, you will be at least partially responsible for those debts once you get divorced.
If you can close a joint account at the time of the separation, make sure to do so. This way, you can avoid your ex-spouse racking up more debt in your name. Once you’ve separated, consider keeping all of your non-marital debt independent of the debts you accumulated while you were still married. Think about opening up a new credit card after you’ve separated, and when possible, refrain from using any credit card that still carries marital debt.
Whatever the circumstances, make sure to pay all of your credit cards off or at least make the minimum payments. If you don’t, not only will you have to suffer the hardship of divorce, but your credit score and history will plummet as well.
How Are Financial Statements Analyzed in Divorce?
Financial statements always come with divorce, and they are official documents that vary by state but will apply to anyone filing for divorce. Depending on your annual income, you’ll be asked to fill out either a short or a long form. These forms must include all of your accurate, financial information, including all of your assets and debts.
While there are special circumstances, financially speaking, credit card and other divorce debts are a lot like marriage vows. Whether or not it was spoken during your wedding ceremony, the implicit vow “for richer or poorer” meant that you agreed to share in whatever debts you and your spouse accumulated during the course of your marriage.