If you are in the midst of a divorce, then you will want to consider how you will handle your credit situation. This includes your mortgage, you equity lines of credit, any joint credit cards, and all other credit that may be outstanding and jointly owned by you and your spouse. You may want to hire a financial professional to help you determine what to do with all of these accounts, and an attorney can also help you to work through the situation.
When it comes to marital debt, you will be able to divide the expenses during property division. Unfortunately, if your spouse has racked up the majority of the debt, but it is in a shared account, then you may still be required to pay about half of it. While this may not seem fair, all debt that is accumulated in joint accounts is considered equally the husband and wife's responsibility.
Joint accounts are only those that both spouses signed for and have a responsibility to pay, For example, in most cases the mortgage is considered a joint account if the house is jointly owned or both names are on the loan. Any other loans that have been signed by both spouses are considered joint accounts.
It is best to cancel all joint accounts at the beginning of divorce. This is so that a spouse will not bring up the debt in an account in hopes of having that debt divided and leaving you to pay half of it. In some divorces, spouses will fail to cancel their accounts, and as a result on spouse will go on a shopping spree, piling debt into one account. When the property is divided, the debt will be split, leaving the other spouse to pay half of the costs of the surmounting debt.
As well, you will want to consider tax debt during your divorce. The IRS can look back for three years and you will want to determine whether or not any income tax debt that your spouse has might be applied to you. It may be wise to hire an accountant to help you with this, and even if you do not hire an accountant make sure to get your attorney involved as you are determining whether or not you have any tax debts that need to be paid.
In some situations, you may need to consider your individual accounts as well. If you have bank accounts that are separate from your spouse's, then you may not be responsible for any debt in your spouse's accounts. On the other hand, if your spouse has a credit card that is connected to your personal account and brings up debt on this card, then you are responsible to pay this back regardless of whether or not the purchases were for you or apply to you.
You can also do the same thing on a spouse's account. It is wise to close any individual accounts that you have if your spouse has access to these accounts and re-open the accounts in your name only. This will help you to avoid having to pay a spouse's spending debt.
Marital debt is all debt that you have accumulated within the marriage and will normally be divided with equitable distribution. If you have any questions about debt and divorce, or if you are concerned that you may get stuck with the bulk of a spouse's expenses, then you need to talk with an attorney at a local family firm today. With the right attorney you may be able to get the compensation that you need in your case. Don't hesitate to call the firm right away to learn more!