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Joint credit cards and divorce

If you and your spouse have decided to divorce, you may hope this will release you from many of the conflicts that persisted throughout your marriage. Among those may be the financial issues that added stress to an already fragile relationship. However, if your money problems included credit card debt, it is not likely you will walk away from the marriage without taking your share of the debt.

In Ohio, as in most other states, any debt you and your spouse incur during your marriage, the law considers joint debt. This means the court may assign you a portion of the debt to repay after the divorce. It is wise to tread cautiously when it comes to credit card debt and divorce.

Why worry about the credit cards?

If your name is on any credit card account, the creditor can pursue you for the debt even if a divorce decree assigns the repayment of that card to your spouse. Creditors are not bound to abide by divorce decrees and may demand payment from you if your spouse defaults. This is why advisors agree that the best course of action is to pay off as much joint debt as possible before you begin divorce proceedings.

Of course, you will want to stop using joint charge accounts after you and your spouse separate. Some divorcing couples make the drastic mistake of continuing to add to their debt, leaving each other with complicated finances and divided income. If you must use the credit card during your separation, make sure you keep careful records of what you spend to give you a better chance of avoiding being stuck with the expenses of your spouse's reckless spending.

Dividing the debt

If you have several joint credit cards and worry that you may end up struggling financially to repay them after the divorce, some steps you can take include the following:

  • Cancel all joint credit cards to prevent your spouse from running up more debt.
  • Remove your spouse from any credit cards for which he or she is an added cardholder.
  • File documentation with the court as early as possible in the divorce to establish a record of the joint credit card debt.
  • Open separate credit accounts and transfer agreed-upon balances to fairly divide the debt.
  • Seek legal advice about the option of bankruptcy to relieve both of you of the debt.

In fact, obtaining legal counsel at any point in your divorce discussions is a prudent move. You can improve your chances of gaining a fair division of both assets and debts and learn of the available resources for dealing with credit card issues.

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