While most couples worry about the delicate nature of dividing property including the house, vehicles, collections or a family business, that is only a small piece of the financial puzzle. Not only will couples have to examine their assets, they must thoroughly discuss the debts and liabilities they have shared responsibilities for.
Who is responsible for the credit card payments after a divorce?
In a marriage that has lasted years or decades, couples will almost certainly amass numerous debts. These can include mortgages, vehicle loans, personal loans or medical bills. The most common type of shared debt, however, is credit card debt. As an equitable distribution state, Georgia will examine debts in much the same way it looks at assets.
The division is known as marital property and separate property. Generally, any asset or liability the couple acquires during the marriage – regardless of the name on the title – is considered marital. Separate property includes assets that were clearly owned by one party prior to the marriage or assets that were gifted to or inherited by a specific spouse. Marital property is divided as equitably as possible.
Credit card companies still want paid
It might be a harsh reality, but your creditors don’t necessarily care that you have ended your marriage. They still expect to be paid on time. It is important to remember you are responsible for credit cards with your name on them. If you and your spouse shared an account, it is wise to either close that account outright or have your name completely removed going forward. In short, the credit card companies follow a different set of rules than your divorce decree.
Protecting your money
It is not wise to assume your spouse will pay the debt he or she is responsible for. Many couples find it easier to pay off those types of debts prior to a divorce. While this is easier said than done, the fewer cards and accounts you share heading into the divorce process means less complexity throughout the asset and debt division process.