Debt Post Divorce
Working out marital property division during a divorce is challenging. Here are some helpful tips to keep in mind:
A couple can come to an agreement as to how to share the marital debt and who is responsible to make the payments on it. This, however, does not mean that the non-paying party is off the hook for that debt. If you are listed on the account and your ex fails to make a payment, the creditor can hold you liable and engage in debt collection against you. Hence, it is extremely important that you confirm with your ex that they are making the monthly payments until that debt is fully paid off.
If you shared a marital home and one spouse agrees to let the other keep the marital home, you are not off the hook until you refinance and get your name off the joint mortgage. Some parties assume that signing a quit claim deed gets them off the debt, but it does not! You are still financially responsible to the lender until your name is completely off the mortgage.
Any missed payments on your car note and car insurance that is jointly titled in your name will also have an adverse affect on your credit. Make sure you retitle your vehicles and car insurance policies.
Any foreclosure actions may affect both parties’ credit and have long-term financial challenges.
It is important to take the time to analyze your financial situation before deciding on how to handle your marital property division. If you need assistance, please call us (443) 741-2567 and we would be happy to meet with you to answer all of your questions.