Going through a divorce is difficult enough without taking finances into consideration. Unfortunately, many couples going through a divorce have at least some kind of joint credit card debt together, which can even further complicate things. Who will be responsible for the debt? Typically, debt that was accrued during the marriage is the equal responsibility of both parties after the divorce. However, there are some steps you can take to help relieve the financial burden of shared debt during the divorce process.
DO Consider Using Savings to Pay Off Debt
For starters, consider using a joint savings account or even a home equity loan as a means of paying off some or all of the joint credit card debt that's been accrued. This way, it's possible for both parties to have a "clean slate" when it comes to finances after the divorce. If all the credit card debt cannot be eliminated before the divorce is finalized, work with a divorce lawyer to get in writing exactly how much has been paid down and how much each party will be responsible for paying.
DO Consider Filing for Bankruptcy Together
Another option divorcing couples who are in debt can consider is that of filing for bankruptcy together before the divorce is finalized. Of course, this is only recommended in situations where the couple is overwhelmed with debt and will otherwise be unable to feasibly make payments on it after the divorce. By filing for bankruptcy jointly before the divorce, both parties can potentially reduce their total amount of debt owed and lessen the financial burden that will come with living on one income.
DON'T Run Up Careless Charges
Finally, don't make the mistake of thinking that you can run up thousands of dollars in credit card charges before the divorce with the assumption that your spouse will automatically be responsible for paying half the debt. It's possible for your spouse to make a claim that you were spending frivolously. If this can be proven in court you may be ordered to pay that debt off yourself in its entirety. Really, the best thing that you can do to avoid these kinds of situations is to cancel all joint credit cards as soon as divorce proceedings start.
Dealing with credit card debt only makes the process of going through a divorce that much more challenging. However, by keeping a few considerations in mind, divorcing couples can do their part to get their finances in order before everything is finalized. If you need more help handling your divorce, contact the Wise Scheible Barkauskas lawyers in Calgary.