Divorce is defined as the legal dissolution of a marriage, resulting in the severance of all marital duties and
obligations between two people. It seems simple enough, but this definition implies that a divorce frees you of any and all responsibilities that you had during the marriage. The truth is, there are certain financial and legal obligations that can haunt you long after the final judgment of divorce. The most common post-divorce liability is credit card debt, especially if your former spouse files for bankruptcy. While your ex's bankruptcy itself has nothing to do you, the debts listed in the bankruptcy filing may be debts that you had accrued during the course of your marriage. This means that the credit card companies, who are forbidden from going after your spouse, will come after you for the outstanding payments on your joint credit
cards. Even if your ex hasn't filed for bankruptcy, credit card companies are allowed to demand payment from you as long as the account has your name on it.
One way to protect yourself is to add an indemnification clause to your divorce agreement, which will allow you to sue your ex for any money you had to pay as a result of defaulting on a loan that he or she was supposed to cover. This is a process that requires careful negotiation, so you will want to work with a divorce attorney to ensure that your rights are protected. While an indemnity clause is helpful, it doesn't actually stop the creditors from coming after you. The only way to truly protect yourself is to resolve these debts during the divorce proceedings. Spouses tend to focus on financial support and dividing properties, which are indisputably important aspects of any divorce. It's essential, however, to take care of any outstanding debts and liabilities before even approaching the question of property.
An experienced divorce attorney will place heavy emphasis on using the available marital funds to pay off your existing joint credit card debts. This could mean liquidating certain assets that you had your heart set on. A good lawyer will not try to force you into one decision over another, but they will warn you of possible future consequences such as bad credit and wage garnishment, regardless of what it says in your divorce judgment. In addition, your attorney will help you close out the accounts, or have you removed from the account if your spouse wants to keep it going.
For more information on credit card debts, and other post-divorce liabilities such as car loans, mortgage payments and back taxes, please speak with the divorce attorneys of Villani & DeLuca, P.C. Even if you are resolving your divorce through mediation, it's imperative to discuss all your financial liabilities before signing a divorce agreement, since the courts rarely allow a final judgment to be appealed. Our attorneys will be happy to advise you on your rights and legal options during a free initial consultation.