Divorce - Take Care of Finances First

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Will your credit be damaged due to a divorce?  Will you be responsible for credit cards or loans that are in both names?  If you wait until your day in divorce court, you may have a rude awakening – divorce doesn’t relieve you of financial obligations incurred during the marriage.

If the home is in both of your names and one party gets to live in the home, this doesn’t relieve you of liability – this is one reason if possible selling the home is the best way to protect yourself from this obligation.

If credit cards are in both names,  the credit card company can and will come after both parties if they’re delinquent on payments.  It would be a good idea to pay off credit cards and cancel them removing your name once again from a future unnecessary expense.  Meanwhile if divorce is imminent one or both parties can continue using credit cards etc., which can be an astronomical amount of money over a period of time. 

Divorce will not remove you from your obligations on credit cards – if cards are left in both names one spouse can continue using the card which may be very costly to you.

Both parties are responsible for anything that the marital couple has purchased together with both names on the loan or mortgage.  If you are a co- signer on a purchase made by your soon to be ex and he or she default on payments, you’re next in line to be dunned for the balance due.

 Logically this doesn’t seem fair if one party ends up with the house, car and half of the marital assets that you will be held accountable if mortgages, loan payments or credit cards debts are defaulted on. 

Even before divorce it is advisable to get some legal or financial counseling on any marital obligations which have both names on the loan or mortgage such as vehicles, furniture, air conditioning units, appliances etc.  Just a brief visit with an attorney, tax specialist or counselor may save you money and heartache in the future. The laws of your State will govern your decisions and you’re on a “need to know” basis at this time.

It’s again the old rule “don’t assume” anything when it comes to divorce – if you wait until you get to court the judge’s decision may in fact not be in your favor.  It’s best to get a game plan on your finances now before you get to court.

As Always,

Little Tboca