Dealing With Debt In Your Fort Lauderdale Divorce

Getting a divorce can always raise complex financial issues

, but when you end your marriage and you and your spouse have a lot of joint debt, things become even more complicated. To deal with your debt proactively and to make sure you do not get burdened paying for your spouses spending and use of credit, you need to follow the proper legal steps for resolving debt in divorce. A Fort Lauderdale divorce attorney can assist you in the process of fairly and finally dividing debt in a divorce situation, but you should also consider some of the following tips about debt and divorce:

The divorce agreement isnt enough

If you and your spouse co-signed for a joint debt together, you both owe that debt. This is true whether you are married or not. This is also true even if your divorce agreement says your spouse owes the debt and you dont. The reason creditors can still come after you, despite what your divorce agreement says, is because the creditor issued the credit based on having both your name and your spouses name on it. Divorce courts dont just have the power to unilaterally remove you from the obligation you have to the credit card company.

Because you remain responsible for debt that you jointly co-signed for, even after divorce, it is important to find a more final solution to dealing with martial debt during the divorce process. For instance, you could refinance the debt into the name of the spouse who will be responsible for paying it. You could insist all debts be paid off as part of the divorce process (such as by using the proceeds from the sale of the marital home). Or, you could take a larger portion of the marital assets in exchange for agreeing to pay the debt, thereby putting you in control of whether it actually gets paid or not.

If you do not find a solution to your shared debt and you do remain responsible in the eyes of the creditor, then your credit could be ruined if your spouse doesnt pay. Not only that but you could be sued or otherwise pursued for the unpaid debt and you may have to hound collections calls and juggle debt collectors who dont care at all if your divorce agreement says your ex is supposed to pay.

A quit- claim deed doesnt get you out of your mortgage obligations

Many couples buy a home or other property together and, when the two divorce, they have to determine which of them should keep the property, if either. In many cases, where one spouse makes the decision to keep the shared property, the other spouse will sign something called a quit-claim deed believing that this simple process will dissolve their legal rights and obligations in relation to the property.

The fact, however, is that a quit-claim deed typically cant get you out of your mortgage obligations at all. Instead, you could give up the right to your ownership interest in the property but still be required to pay the bills or ruin your credit. This is because, like with credit cards and other debt, the mortgage lender issued the loan based on your joint income and joint credit.

If your name is on your shared home mortgage, therefore, you are going to be responsible for paying that mortgage until your name is off of it or until it is paid off in full. The only way to absolve yourself of the financial responsibility of the loan is for your spouse who is keeping the property to refinance into his/her own name if possible based on credit score, income level, and current market conditions.

by: Jeff Miller

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