Divorce and Credit

When a marriage falls apart, former partners must divide their financial lives–often at a time when communication is most difficult. You and your partner must reach an agreement about the investments and debts you took on as a couple. You must prepare to stand on your own as a credit customer.

A divorce decree doesn't affect your agreements with creditors. You could be liable for marital debts even if a court-approved decree orders your former spouse to pay them. It depends on whether you had individual or joint credit. Individual credit is based on your assets, income and credit history. You alone are responsible for paying an individual account, even if you're married.

In "community property" states, however, the assets and debts of one spouse belong to both spouses. Your lawyer will be able to tell you if this applies to you.

Joint credit is based on the assets, income and credit history of both people who apply. Your combined resources may help you get a higher line of credit. But it also means that you both are responsible for paying off the debt. If one person fails to pay a joint account, the creditor can require payment from the other even if you are separated or divorced.