Divorce & Credit - Don't let your ex trash your credit
You've got a lot to worry about when you go through a divorce, but don't let it screw up your credit. There's a good article on the subject on MSN Money:
"When Joan divorced several years ago, her ex agreed to pay off the couple’s $20,000 in credit-card debt. They made the agreement part of their official divorce decree.
That, Joan thought, was that. Except every couple of months since then, creditors have called her because her ex has missed a payment. Despite the divorce agreement, she’s still on the hook, and all the late payments have trashed her credit.
“I just assumed my responsibility ended” once the divorce was final, said Joan, a Los Angeles homemaker who asked that her last name not be used. “But it turns out that’s not true.”
Many divorced people learn the hard way that creditors don’t care how property and bills are divided in a divorce. If a debt was incurred in a joint account, both spouses are responsible for paying it back.
Your agreement with your creditors predates your split, explains divorce attorney and financial planner Amy Boohaker of Sarasota, Fla. You can’t force a creditor to abide by an agreement you make later with your spouse.
And not every divorced person gets a phone call to notify them that their ex is in arrears. It was only after Atlanta resident Tony Martin pulled his credit report, for example, that he learned his ex-wife had failed to pay the mortgage on the family home she received in their property settlement. Since his name was still on the loan, the foreclosure will remain a major blot on both of their credit reports for seven years.
In an ideal world, divorce attorneys would alert the clients to these dangers and help them protect themselves. In reality, the discussion may never happen. A couple may not use an attorney, or the lawyer may not be fully aware of the credit problems an irresponsible or vengeful ex can cause."
Full article on MSN Money
"When Joan divorced several years ago, her ex agreed to pay off the couple’s $20,000 in credit-card debt. They made the agreement part of their official divorce decree.
That, Joan thought, was that. Except every couple of months since then, creditors have called her because her ex has missed a payment. Despite the divorce agreement, she’s still on the hook, and all the late payments have trashed her credit.
“I just assumed my responsibility ended” once the divorce was final, said Joan, a Los Angeles homemaker who asked that her last name not be used. “But it turns out that’s not true.”
Many divorced people learn the hard way that creditors don’t care how property and bills are divided in a divorce. If a debt was incurred in a joint account, both spouses are responsible for paying it back.
Your agreement with your creditors predates your split, explains divorce attorney and financial planner Amy Boohaker of Sarasota, Fla. You can’t force a creditor to abide by an agreement you make later with your spouse.
And not every divorced person gets a phone call to notify them that their ex is in arrears. It was only after Atlanta resident Tony Martin pulled his credit report, for example, that he learned his ex-wife had failed to pay the mortgage on the family home she received in their property settlement. Since his name was still on the loan, the foreclosure will remain a major blot on both of their credit reports for seven years.
In an ideal world, divorce attorneys would alert the clients to these dangers and help them protect themselves. In reality, the discussion may never happen. A couple may not use an attorney, or the lawyer may not be fully aware of the credit problems an irresponsible or vengeful ex can cause."
Full article on MSN Money
posted by Dave at 1:39 PM
0 Comments:
Post a Comment
<< Home