Debt and Divorce in Charlotte, North Carolina

According to a recent advice column on, post-divorce debt is one crucial issue often ignored by parties in the aftermath of a divorce. Many mistakenly believe that everything has been resolved by the divorce decree. However, some unfortunate divorcees have discovered that things are not always so simple.

According to former bankruptcy judge and current attorney R. Glen Ayers, “Most divorce decrees allocate liabilities for pre-divorce obligations between the former spouses. So, the husband agrees or is ordered to pay certain credit card obligations and similar debts. The wife may agree or be ordered to pay a car note or some other debts. While the divorce decree may allocate responsibility between the spouses, that decree does not release either spouse from the obligation to the creditor.”

The fact is that even if a settlement agreement lays out who is to pay what debt, it does not mean that the other party is legally released from the formerly joint obligation. If the spouse responsible for making the payments falls behind, then the other spouse remains liable to the creditors, regardless of what the divorce decree says.

The Federal Trade Commission’s website contains advice for anyone considering divorce, saying to pay special attention to the status of your credit accounts. If you maintain any joint accounts with your ex-spouse, it’s critical that you continue making regular payments so that your credit score won’t suffer. As long as there’s a balance on a joint account, you both remain legally responsible for it.

If you do decide to divorce, a skilled North Carolina family law attorney would suggest that you close joint accounts or accounts where your former spouse is listed as an authorized user. You might also consider approaching the creditor directly and ask that they convert the account to an individual account.

By law, a creditor cannot automatically close a joint account simply due to a change in marital status. However, creditors can close accounts at the direct request of either spouse. The creditor can, however, require you to reapply on an individual basis and then, based on your new application, extend or deny you credit. If the debt in question is a mortgage, the creditor may then require the spouse responsible for maintaining the debt to refinance and thus totally remove the other spouse from the obligation.

Debt issues can make an already difficult divorce even more complex. If you find yourself grappling with financial questions, it’s important to have an experienced Charlotte family law attorney on your side who understands the complexities of the money issues you face.

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