I hear this situation all the time – some one tells me that their ex refuses to pay the bills assigned to them in court. They are perplexed at why their credit report is showing late pays or charge off – the bill is their ex’s responsibility. Ah yes, there are many lawyers out there whose necks I’d cheerfully wring for telling those going through the divorce process that the divorce will rid them of debts.
Unfortunately, it’s not true that a divorce decree removes joint responsibility for debt. When a divorce decree is written, although it is a legal document, it has no binding effect on your creditors. Indeed, I doubt representatives from Discover, for example, were present in the court room at the divorce hearing or even discussed your plans with your lawyer while papers were being drafted.
You and your spouse signed (via the internet or on a piece of paper) the application, and agreed to pay back your credit card debt – this is the contractual agreement that matters. I guarantee there’s no clause in the contract that says that a divorce decrees absolve one party or the other of responsibility.
I know of no circumstances where a credit card company will “remove” a name off of an account, even if it’s not an issue related to divorce. There is also no way to remove someone’s name off of a mortgage. You must totally refinance the loan to re-assign responsibility for a debt. Especially these days, creditors want as many necks on the chopping block as possible to guarantee that loans/credit card balances are repaid.
There are many reasons why an ex might default on credit cards or a mortgage. Often, the ex’s credit is so bad that he or she doesn’t care if the credit card is charged off. Some do not pay a bill as revenge, knowing full well the consequences of defaulting on their ex’s credit. Some ex-spouses who default on their responsibilities are unaware that not paying will negatively affect their ex-’s credit (not all divorces are acrimonious).
So what can you do if your ex won’t pay?
- Talk to your ex if possible and see if you can work something out.
- If your credit is important to you, you can pay the bill, even if you feel this is unfair. Remember, a charge off on your credit report can totally tank your credit score. You have to weigh the price of good credit. Ruining your credit on the “principal of the situation” may be something you regret later.
- If you can’t get your ex to pay and you cannot afford to take on the payments yourself, you may be able to seek a remedy in court. Your ex has breached your divorce contract, and you can possibly seek damages.
Has this happened to you? Tell us about it.
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This happened to me. I ended up paying debt that was not mine in order to save my credit. I didn’t even know he had this charge card! Good article.
Michelle,
I’m just curious about your post and situation with paying the debt to save your credit, but you didn’t even know your ex had that charge card (during your marriage). A similar situation happened to my husband during his first marriage. His divorce attorney helped him get absolved and removed from that debt with that creditor. apparently, his then wife-at-the-time had opened a Target charge and a BofA visa, signed (forged) his name to the applications (actually opened them under his name since she was a stay at home mom with no income of her own) and added herself as the joint account holder. She was always the first one to see all the mail every day since she was at home while he was at work. So he never even knew the accounts existed (he wasn’t exactly diligent about reviewing his own credit reports back then). Anyway, long story short, the accounts came out during dividing the debt during their divorce, and boy was he mad. BUT his attorney said that her forging his signature to the aps was fraud. They drafted and signed an agreement between him, her and Bank of America and Target that if she assumed those accounts in full and paid them off, he and BofA and Target wouldn’t pursue her legally for fraud. She agreed. BofA said they’d keep the visa open, just put it solely in her name, and take him off the account. They did. And then, hilariously, once she paid the balance off, the shut that puppy right down on her! lol.
Anyway, I’m telling you this story because, although it’s too late now that you paid the account off, you probably could have gotten your name off that account by threatening to file fraud charges with that credit card company. It’s a very simple process, actually. The bank sends you a form and asks for all the pertinent info about the situation and you have to submit three notarized copies of your signature. Then they handle it from there and contact the account “opener.” Unless you actually signed the original application yourself, they cannot hold you legally liable for that account. If this happens to anyone else reading this, pursue it – talk to an attorney if you need help with a situation like this.
This isn’t correct…
FWIW, on credit card accounts, you can request a “remove jt signer” letter. This form requires the signer of both parties: the one being removed and the remaining signer. It also requires the approval of the issuer. Generally, the remaining signer is then evaluated on his/her creditworthiness and ability to repay the outstanding debt.
Most often, this letter is used in the case of divorce or separation.
Most of these letters contain a checkbox that must be selected in the event the request to remove the jt signer is denied.
Option 1: The account remains open and both signers remain jointly and severally liable.
Option 2: The account is closed under the old terms of the agreement. No new charges can be made and both signers remain jointly and severally liable.
It goes without saying that in order to request the remove joint signer letter, the account will need to be in good standing. So, one will need to know about this prior to filing divorce…