Credit card debt along with other financial obligations are usually part of the property division process of a divorce. Couples must divide their financial obligations in addition to their shared assets.
Many people approach debt division with inaccurate expectations. Some couples have joint accounts where each spouse has a card attached to the same line of credit. Other couples may each have their own lines of credit that they take personal responsibility for and use exclusively.
The name on the account isn’t the main concern
When the courts identify separate and marital assets and debts, ownership records are not the most important element for them to consider. Instead, when people took on debt or acquired property is often the deciding factor.
Regardless of whose name is on a particular credit card account, both spouses may technically be responsible for debts incurred during the marital relationship. There are exceptions in cases where there is evidence that one spouse made an attempt to hide the debt from the other or engaged in other forms of financial misconduct, such as dissipation.
Incurring large amounts of debt as a means of diminishing the marital estate and inappropriately altering property division proceedings could change what the courts view as reasonable and just when dividing marital debts. Most other credit card balances may influence property division outcomes.
Those concerned about credit card balances and financial obligations during divorce may need to review recent financial records with their legal representative. Understanding what laws apply during property division proceedings can help spouses avoid credit blemishes and an unsustainable personal budget after divorce.