In our world, today debt has more or less become a way of life for many families. When we consider even a few generations ago how people dealt with and approached debt I think that we would find that attitudes on this subject have changed dramatically.
It was a fear of our great-grandparent’s generation that the loss of a job would cause a family to fall behind on their mortgage causing their homes to be taken away by the lender (usually a bank). There were no credit cards and purchasing items on credit was not widely utilized.
Fast forward to our parent’s generation and credit cards came into being and along with it the ready acceptance of plastic instead of paper at even the most mundane of businesses.
How many of us whip out a credit card at the grocery store to pay for a gallon of milk? I couldn’t tell you the last time I used gas to pay for a fast-food hamburger or cup of coffee. The fact is debt is everywhere- both big and small.
What happens when those debts are essentially ignored for long period of time by a family? The debts grow due to the effect of interest on the principal amounts. This can creep along almost unnoticed for a long period of time until something comes about to bring these debts into focus. From my experience, little else causes a family to notice the issues in their lives more acutely than a divorce.
Credit and Divorce: Typically a not so great combination
Everyone wants to have a high credit score. From my experience representing southeast Texans like yourself in divorce, I’ve heard many more people talk about the desire to maintain a strong credit score as opposed to earning wealth for themselves and their families.
It may be that because wealth is simply harder to attain, people settle for the high credit In so doing, you are admitting that debt will always be a part of your life and that making regular payments to a financial institution is a part of your life’s plan.
If in the meantime you are able to enjoy your life then that is all for the better. However, this sort of lifestyle can “come home to roost” at the time that you and your spouse begin to go through a divorce.
If there is credit card debt who has to pay it after a divorce is finalized?
When you and your spouse open up a credit card account together that means that you are both signing off on the debt that each other incur on that card. Each of you are jointly and severally liable for the debt and the credit card company will view it as such.
On the other hand, if you open up a credit card account in your name only and allow your spouse to be able to use the card he or she becomes merely an authorized user. If your spouse has an existing account at the time you become married it is easy enough to simply add your name as an authorized user at that time.
The obvious problem with this sort of set up is that you would have no “skin in the game”, so to speak. Meaning that you can charge whatever you would like to on the card theoretically and hold no personal or legal responsibility for the debts that are incurred. Only your spouse as the account holder would have that sort of responsibility. Your actions may put your spouse in a bad spot during the marriage and can cause an issue to rear its ugly head if a divorce were to be filed.
The effect on a credit card authorized user- does using a credit card build credit?
You as the hypothetical authorized user in our prior scenario have your own risks to ponder as well. While you may not have any responsibility to pay the debt, either during the course of your marriage or after a divorce, you are not creating a positive credit history for yourself.
While we have previously discussed the merits of even wanting to build a positive credit history unless you have sworn off using debt to live your life having a positive credit score will be crucial to your being able to apply for loans like mortgages in the future.
Staying in a bad marriage for the sake of your credit
Both spouses, as you can see, could be persuaded into remaining in a bad marriage for the sake of maintaining some degree of financial well being. If you are the account holder, you may not want to venture off into single life and take a crushing amount of credit card debt with you.
On the other hand, if you are an authorized user of a credit card, you too may not want to risk going off on your own without much credit history or cold hard cash to help you make your way as a newly single man or woman.
Unfortunately, this is a motivator for people to stay in abusive, toxic or just unhealthy relationships. Unless your family seeks counseling on these issues and begins to live on a monthly budget there will likely be no end in sight to either the debt lifestyle or the bad marital relationship.
How to handle credit card debt in conjunction with a divorce- tomorrow’s blog topic
We hope that the introduction to this topic has been interesting and attention-grabbing for you. Please return to our website tomorrow to learn more about how credit card debt can be successfully handled in the context of a divorce.
If you have questions for one of our licensed family law attorneys please do not hesitate to contact the Law Office of Bryan Fagan, PLLC today. A free of charge consultation can be yours six days a week where one of our attorneys can answer your questions in a comfortable and pressure-free environment.
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Other Articles you may be interested in regarding
- How are Credit Cards Handled in a Texas Divorce?
- How credit cards and debts are handled in a Texas Divorce
- Handling the issue of credit card debt during your divorce
- What Happens to Marital Debt During a Texas Divorce?
- Know How Property and Debts are Divided, When Preparing for Your Texas Divorce
- What Happens to Marital Debt During a Texas Divorce?
- Dividing Property in a Texas Divorce - The Just and Right Division
- Why is Separate Property Important and How to Keep it Separate in a Texas Divorce?
- What Wikipedia Can’t Tell you About Texas Divorce and Marital Property Division
- Texas Divorce Property Division Enforcement
- Separate Property in a Texas Divorce?
- Does it Matter Whose Name is on Title or Deed of Property in a Divorce in Texas?
Law Office of Bryan Fagan, PLLC | Houston, Texas Divorce Lawyers
The Law Office of Bryan Fagan, PLLC routinely handles matters that affect children and families. If you have questions regarding divorce, it's important to speak with one of our Houston, TX Divorce Lawyers right away to protect your rights.
Our divorce lawyers in Houston TX are skilled at listening to your goals during this trying process and developing a strategy to meet those goals. Contact Law Office of Bryan Fagan, PLLC by calling (281) 810-9760 or submit your contact information in our online form. The Law Office of Bryan Fagan, PLLC handles Divorce cases in Houston, Texas, Cypress, Klein, Humble, Kingwood, Tomball, The Woodlands, the FM 1960 area, or surrounding areas, including Harris County, Montgomery County, Liberty County, Chambers County, Galveston County, Brazoria County, Fort Bend County and Waller County.