Ask MyCreditGroup: Divorce and Debt. Who Pays?
For better or for worse, for richer, for poorer, in sickness and in health, to love and to cherish; from this day forward until death do us part.
And if we divorce, I promise to continue paying my share of the credit cards.
Wait, what?
When we meet that one perfect person, the one we plan on spending the rest of our lives with, none of us are thinking about who’s going to pay the credit card bills when we divorce.
Divorce is a fact of life, and a large number of our clients come to us after a marriage has gone south and with it – credit scores. Below is a question we received last week from one of our clients. We should have addressed this a long time ago, because it is a question we see ALL THE TIME. But we didn’t so we are now.
“My Wife and I divorced last year. Together we had a few credit cards and an auto loan. The divorce decree states that she pay for our Discover payments and the car payments.
The day before yesterday, I got a call from Discover and they were saying that the payments hadn’t been paid in two months and that if they weren’t caught up, my credit could be damaged too.
Why should I be responsible if we made an agreement in court that she would take full responsibility for that card? Is there anything that can be done about this?
Thanks John”
MyCreditGroup’s Answer: John, you’re going to want to check the laws in your particular state. However, we do deal with this scenario a lot and I can tell you, typically the original contract (the one you signed when married) takes precedence over a newly written divorce decree.
The credit card company’s view is that they don’t care what has happened after the fact. What they do care about is the fact that you signed a contract, married or not, and that’s the contract they’ll use to collect their money.
I’m sorry, but chances are they can come after you.
If you are on good terms with your ex-wife, give her a call and see if you can’t work something out. It may not be your debt anymore (per your divorce), but at the end of the day, it’s your credit and your responsibility to protect it.
Also, you mentioned Discover said it had been 60 days since the last payment. I suggest you go to http://www.annualcreditreport.com/ and check your credit. There’s a good chance you already have late pays showing.
Rockey Mas
hey, love the blog – i will try and keep up with it!! please keep more coming
I wish I could start a blog
Eric Parker
From my experience, the bank sees the responsibility for payment in whoever the card’s name is in. If the card is a joint account (in both of your names), then both parties on the hook for the full amount. Authorized users, however, are not responsible for the credit card. I have seen instances with joint accounts when one ex-spouse declares bankruptcy after a divorce and the bank goes after the other spouse for the full amount. In the courts of some states, it doesn’t matter whose name the credit card was in as long as the debt incurred was after getting married, both couples can be legally responsible for it. You might want to ask your ex-spouse to do a balance transfer and get the debt out of your name completely. Hope this helps.
Marc Chase
Folks, Eric nailed it. As we said in the post, if its in your name, and the debt occured after you were married, being divorced does not change the fact.
Thanks Eric, all good points (Even for a collector
Nathanael Centeno
An excellent write-up with valid points, I have been a lurker here for a short time but desire to become more included in the future.