How is credit card debt divided in a divorce?

On Behalf of | Mar 22, 2018 | Property Division

Using a credit card for daily expenses has become more and more common, especially now with smartphones allowing you to go through checkout lanes with only a flick of the wrist. The reliance on the card increases as credit card companies create incentives to keep using it, resulting in credit card debt accumulating if payments are not made in full. While a New York couple is married, the payment of the card usually comes from joint expenses and both parties are responsible for it. But, what happens when a couple is ending their marriage — how is credit card debt split?

Generally, if someone is not an account holder, they are not liable for the debt accrued on the credit card. The issuer of the credit card will go after the primary holder, not the authorized user. However, one step couples can take before the divorce is pay off the card and close the account or decouple it, so further debts do not ruin the authorized user’s credit history.

Where a couple has a joint account, things can get messy. As joint holders of the account, both parties are equally responsible for the debt being accrued. Therefore, if one party runs up the bill during the divorce proceedings, then the other will also be accountable and it will ruin their credit score, if timely payments are not being made. One option may be to close the bank account

after settling the bill, but couples may often lack the financial resources to clear the card. This means the divorce settlement will have to divide the debt.

Property division is difficult enough when assets that both parties want are being disputed — when debts

, which no one wants, are being contested, it is possible that a relatively smooth divorce turns acrimonious. It is beneficial to have an experienced attorney by one’s side who can represent one’s financial picture accurately.