Are you getting ready to work through the divorce process? Have you thought about what you want to get out of it? A lot of Wyoming residents who are preparing to end their marriages think about what assets they want to keep as part of their divorce settlements. However, many forget to consider who will get stuck paying back the shared credit card debt.
Most Americans have credit card debt. Reports indicate the average amount per household is thousands of dollars. Ideally, couples would pay off this debt before filing for divorce, but realistically, most couples cannot make that happen. That is okay, but it is something that needs addressing during the property division phase of the divorce proceedings.
Equitable not necessarily equal
Wyoming is an equitable distribution state. This means that a divorcing couple can expect a fair division of assets, but that does not mean a black and white, 50/50 split. For example, if she wants to keep the house, he will get to keep other assets of roughly equal value — such as money in investments or retirement funds, among other things. When it comes to credit card debt, responsibility for that debt may depend on the following:
- Joint account: If it is on a joint account, each party will likely have to pay a portion of the debt.
- Individual account: If the account is only in one spouse’s name, that individual may have to pay off the full balance on his or her own — unless he or she can prove that the debt was the result of purchases made for the household.
How much you may end up paying will depend on a number of factors.
Get removed or prepare to pay up
After finalization of your divorce, it would be wise to close joint accounts and transfer any debt assigned to you in the dissolution settlement to your own account. Why? This way, credit card companies cannot hold you responsible for any further debts accrued by your former spouse post-divorce. If you fail to close joint accounts, creditors will not care what the terms are in your divorce settlement. All they will see is that you are listed on an account, and they can come after you for payment.
Debt is debt, and someone has to pay it back. When a couple shares credit card debt, or any debt for that matter, and they choose to divorce, they have to take the time to figure out repayment. With assistance, it is possible to walk away from the marriage with no more than your fair share of the marital debt.