Bill collectors do not all of a sudden stop sending their statements just simply because you are going through a divorce. When you enter the limbo of separation, pay particular consideration to its impact on your debts and credit standing.
In general, both spouses are responsible for paying debts generated during the marriage. Once the divorce is final, neither is responsible for the debts created by the other. Debts incurred during separation, nevertheless, can be difficult. The common rule is that debts incurred after the separation date but before the divorce is final are the responsibility of the spouse who incurred them and must be paid by that person.
One exception is for "family necessities." For example, if, during the period of separation, one spouse incurs a debt for food, clothing, shelter, or medical care, the other spouse might be obligated to pay a portion of that bill. Children's expenditures, too, generally fall into this category. The law views a spousal help or child help obligation as more essential than one to a creditor.
The general rule - that debts generated during separation must be paid by the person who incurred them - does not usually protect you, nevertheless. If your partner defaults or simply refuses to pay, the creditors no doubt will come after you for payment. Because you were nonetheless married when the debts had been created, the creditor will assert a right to collect from you. Your only remedy may be to try to get reimbursed by your ex-spouse.
When you're financially connected to someone else, you're at risk. You are responsible for any use of a credit or charge card by either cardholder on a joint account. Most of the time it is greatest to close joint credit accounts, because you cannot control your spouse's use of them.
But before angrily closing all joint credit accounts, check first to see how your individual credit will probably be affected by such an action. If you don't have credit in your personal name, be sure to establish it before you separate.
There may be certain circumstances in which you'll need joint credit. For instance, if you'll both be buying maintenance objects for your house, rental property, or kids, it might be convenient to have a joint checking account to which both you and your spouse contribute.
You can make a formal written agreement as to how the account will probably be used and even require that all checks written on the account must have both spouses' signatures. Keep in mind, nevertheless, that despite the fact that you might need to retain joint accounts, you should not consider starting any new joint financial ventures.
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Note: This article was sent to us by: Dean Ruttfield at 01172011
1. Do not overlook Equity Credit Lines when divorcing
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