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What happens to credit card debt in divorce?

An important, often unexpected financial impact of divorce can be on your credit score. Most married couples have at least one joint card, and many have multiple cards that are in both of their names.

So what does that mean when a couple divorces and divides both assets and debts? Since Arizona is a community property state, both partners will in most cases be responsible for any debt incurred in either of their names individually as well as jointly.

If a couple lives in one of the majority states that are considered equitable distribution states, either spouse may be held responsible by the credit card company if both of their names are on the card. If one of the spouses decides to file for bankruptcy, the creditor can go after the other spouse for the amount due.

Liability for credit card debt at divorce depends on whether the divorce is filed in an equitable distribution or community property state, whether the debt is incurred on a jointly held credit card, and to whom the separation agreement assigns the debt.

If the two of you have considerable credit card debt when you divorce that was substantially racked up by your spouse, you should speak with your divorce attorney about how to deal with this so that you aren't stuck with considerable credit card debt or damaged by a hit to your credit score. You may be able to include an indemnification clause in your divorce agreement. However, you may potentially end up back in court with your ex trying to enforce that.

If, despite your best efforts, you find yourself in serious credit card debt due to a divorce, an Arizona attorney experienced in handling credit card debt issues can provide advice and guidance to help you move on with your life without the shadow of your ex's profligate spending hanging over you.

Source: Huffington Post, "Divorce and Credit Card Debt," Justine Borer, April 03, 2017

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  • State Bar of Arizona
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  • NACA | National Association of Consumer Advocates
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