Most people accumulate some type of credit card debt throughout their lives. You may have a tendency to pay off your balances as soon as possible, or you may let balances build and pay them off more slowly. Whatever your choice, you felt that it worked well for you and your spouse, with whom you share joint accounts.
However, now that you are going through divorce, understanding your debt and your spouse’s debt may be vital. You certainly do not want to end up on the hook for outstanding balances that your spouse ran up out of spite or otherwise without your knowledge. If you do not protect yourself, you could end up in such a situation.
Just like marital assets, the court can divide marital debt during the divorce proceedings. A great deal of importance lies with separating yourself from your spouse’s debt. If you do not, he or she could end up on the bad end of creditors, and rather than your ex-spouse dealing with the debt alone, creditors could end up coming after you in hopes of receiving payment. One of the first steps you can take to distance yourself from marital debt is to close any jointly held credit card accounts.
Paying off debt
In a best case scenario, you and your soon-to-be ex could work out an agreement so that you both pay back the jointly held debt. This option would relieve both of you from financial obligations associated with the other. If you both cannot pay off the debt before the divorce takes place, you may have the option to divide the debt and transfer the balances to new, individually-held accounts.
When it comes to dividing the debt, purchases fall under the category of marital debt if they took place before separation and by using jointly-held credit card accounts. After the date of separation, you may find it useful to keep records of your purchases if the accounts have not been closed in order to make it easier to separate your debt from your ex-spouse’s.
Of course, depending on the nature of your case, the court may have more involvement in determining who holds responsibility for which debts. You certainly do not want to end up saddled with more than your fair share, so you may want to review your legal options and find out more information on marital debt.