By Lynda Spence, Family & Consumer Sciences Extension Agent at UF/IFAS Extension-Marion County
Reviewed by Martie Gillen, PhD, Department of Family, Youth, and Community Sciences, University of Florida
Separation and divorce affect family financial management on multiple levels. Most people going through a divorce, especially women, will have reduced resources, along with the added expenses of the divorce process. One of the most important things to do is to protect your individual credit.
Request your credit report at http://www.annualcreditreport.com. Check the credit report for errors, such as inaccurate personal information or incorrect information about your balance or payment history, and make the appropriate corrections.
If possible, switch to individual credit card and bank accounts while you are still married. To avoid acquiring additional joint debt or suddenly losing shared bank assets during the legal process, make every effort to close all joint accounts. If you change your name, you can always change the name on the accounts.
The divorce decree has no legal effect on who is responsible for paying which debt. Each person is liable for the full amount of all debt acquired using joint accounts until the balances are paid in full. Creditors can legally go after either or both parties. If the divorce decree orders one divorcing party to pay the debt, but that individual does not pay, you will need to go back to court to have the divorce decree enforced. Meanwhile, make every effort to keep the account current. Remember to keep documentation regarding what you have paid.
Couples may split their debt. For example, one person might take the MasterCard debt, while the other takes the Discover card debt. However, that is merely an agreement between the two of you. Your original agreement with the lender supercedes personal agreeements. Be aware that if one person files bankruptcy down the road, but there is still debt left over from your marriage, the lender will most likely continue collection efforts towards the other responsible party. Any debt incurred in your name only (for example, a student loan only in your name) will stay with you.
If you are having trouble paying your credit bills on time, contact the National Foundation for Credit Counseling. It is a nonprofit organization founded to help well-intentioned consumers get current on their debt.
To learn lots more about credit and your credit score, visit the Credit Cards topic on UF/IFAS EDIS.
(Photo credit: Living on credit cards by Images Money. CC BY 2.0.)
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