Consulting clients seldom inquire about marital debts, yet debt is common in American marriages. From student loans to credit cards and mortgages, debt is a ubiquitous aspect of our financial landscape. While not all debts are equal, collectively, we should prioritize our concerns regarding debt more than we currently do, especially considering its impact on spouses.

As we discuss property much more than debt in the context of a divorce, I think it is time that we devote an entire blog post on the best practices on how to handle debt in your divorce. I’m not telling you that you should be leaping off your rooftop at the thought of having to pay interest on a loan. I’m not telling you you need to go into your divorce with the mindset that you have to negotiate away all of your debt (hint: you won’t be able to, most likely). Acknowledge that debt significantly impacts your life and should therefore be recognized in your divorce.

Do not stop paying your debts during your divorce (unless suggested otherwise by your attorney)

If you’re already behind on your car payment and considering hiring a divorce attorney, you might contemplate delaying payment until the divorce determines responsibility. This is not a good plan for you to follow. It would help if you continued to make payments on whatever debts you have.

It is likely, first of all, that any debt in your name will continue to remain yours after the divorce. It’s improbable that fleeting thoughts of transferring your debt to your spouse will materialize. With that said, any arrearages in payments that accrue throughout your divorce will be your responsibility moving forward. Your credit will plummet, and the accruing interest will only escalate. A bad situation that is avoidable.

An exception to this general advice arises when the debt isn’t in your name, but you’ve been making payments for your spouse. In such cases, your attorney may advise against paying the debt. For instance, if you and your income produce a car your spouse drives in her name, you may not want to pay the debt. If a judge orders you to do so, that changes things.

Do not pay any more than the minimum payment on a particular debt

Part two of our general advice that you should be paying debt during the divorce as scheduled is that the payments you make should be no more than the minimum. That’s because debt can serve as a bargaining chip in divorce negotiations. It’s unwise to pay off a debt early when you’re uncertain if you’ll receive credit for it. If you pay off a car loan during the divorce, your spouse may even argue that you were wasting community resources in doing so.

I understand the hesitancy to let a debt hang around. I am no fan of debt, and I take out as little debt as humanly possible in my personal life. However, if you have an obligation active, then you should save up money (if able) to pay down the debt after your divorce. This does not hurt you in the long run and keeps your payments current in the short term.

Keep documents handy of your debt payments

This is a general rule applicable to various aspects of your divorce, but I’m applying it specifically to your debt load. If you are making payments on a debt of some sort, you need to document you have done so in case your spouse attempts to argue that you have not been staying current. When a website offers to provide a statement confirming your payment for your records, don’t disregard that suggestion. You can print to PDF and save an electronic version, so you don’t have stacks of paper taking up space in your office or desk drawer.

Keep your spending in check during your divorce

It is tempting to do a little retail therapy during your divorce and buy that television, dress, suit, or other expensive items that you’ve had your eye on and to justify doing so in the name of making you feel a little better in the face of your difficult divorce. After all, you’re going through a lot, and you’ve earned that dress for having done so, right? Wrong.

First of all, you may be violating a court order in spending a ton of money on items that are not necessities. Check with your family law attorney on whether or not your temporary or standing orders bar you from spending money on things like this. If they do, you have one more reason to stay the course and not spend your money.

A massive increase in your credit card debt makes splitting that debt up in your divorce is much more challenging. Suppose that the majority of debt incurred on that particular credit card account was your spouse’s. Then, one day you up the debt number by a couple of thousand dollars. Previously, the debt might have been transferred to your spouse in the final orders. Now, your spouse may be less willing to agree to this sort of clean split and may require you to pay a portion of it or cause you to lose an asset in exchange for your spouse to pay the totality of the debt.

Be careful what you use your credit card to spend money on

Finally, I will point out that credit card statements are commonly requested in discovery. This means that if you are spending money on items that are not related to your divorce, your children, or your work, then you will likely have to account for those in negotiations or court. Spending via a credit card means that a paper trail will be created. It would be surprising if your spouse did not discover what you spend your money on via discovery.

The best course of action, in my opinion, is to do little in the way of your credit card during a divorce. See if you can live on cash as much as possible. Cut your spending to the bone. Only use your credit card when you have to. As stated earlier, pay the monthly minimum payments on the card and no more. If you have a clue to pay off the credit card, you should talk to your attorney before doing so.

Credit cards, in essence, lack inherent moral value; their effects hinge on the manner of their utilization. When managed responsibly, they pose no threat; however, using debt as a means to evade the challenges of divorce or failing to meet payment obligations can result in complications with both creditors and spouses.

Social media and Digital Security best practices- tomorrow’s blog post topics from the Law Office of Bryan Fagan, PLLC

Stay tuned tomorrow as we shift gears to the digital realm to discuss how you should treat online and social media accounts during a divorce. These areas tend to get lulled into a false sense of security where their bad behavior is believed to be done in secret. Don’t let this happen to you. Please read our blog tomorrow to learn more.

In the meantime, if you have any questions regarding family law in Texas, please do not hesitate to contact the Law Office of Bryan Fagan, PLLC. One of our licensed family law attorneys will be happy to schedule a free-of-charge consultation to discuss your issues with us.

Ebook

If you want to know more about what you can do, CLICK the button below to get your FREE E-book: “16 Steps to Help You Plan & Prepare for Your Texas Divorce”

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Other Articles you may be interested in:

1. How to protect yourself from fraud on the community estate in a Texas divorce
2. What is financial fraud and how can it impact your Texas divorce?
3. Can fraud be the basis for your getting an annulment?
4. What is paternity fraud and how can it affect your child?
5. Marriage Fraud in Texas
6. Credit Card Abuse Exposed
7. Do credit card companies know when someone dies?
8. What happens if your spouse doesn’t pay a credit card bill after your Texas divorce?
9. What are some signs that your spouse may be defrauding you?
10. Handling the issue of credit card debt during your divorce
11. Debts, Credit Cards and Divorce in Texas
12. How credit cards and debts are handled in a Texas Divorce
13. First comes divorce and then comes bankruptcy: What to expect when one follows the other
14. What Happens To Debt in Texas Probate?

Frequently Asked Questions

Can a spouse get a credit card in their spouse’s name without permission?

Yes, it’s possible for a spouse to apply for a credit card in their spouse’s name without permission, but it’s considered identity theft and illegal.

Can my husband get a credit card without me knowing?

Yes, a spouse can potentially get a credit card without the other spouse knowing by applying for one independently. However, financial transparency is essential in a healthy relationship.

Am I responsible for my spouse’s credit card debt in Texas?

In Texas, you may not be automatically responsible for your spouse’s credit card debt. Debt responsibility can depend on various factors and the specific circumstances of the debt.

Are credit cards community property in Texas?

Credit cards are not automatically considered community property in Texas. The division of credit card debt can vary depending on the circumstances and agreements made during marriage.

Can you sue your spouse for financial infidelity?

You can sue your spouse for financial infidelity if it has caused significant harm or loss. It’s advisable to consult with an attorney to discuss your specific situation.

Can I legally use my wife’s credit card?

Using your wife’s credit card without her permission is typically not legal and may be considered unauthorized use of a credit card.

How serious is financial infidelity?

Financial infidelity can be a serious issue in a relationship, as it involves dishonesty and can lead to trust and financial problems. Addressing it early is essential for a healthy relationship.

Am I responsible for credit cards in my husband’s name?

Your responsibility for credit cards in your husband’s name depends on various factors, including the nature of the debt and the agreements made during your marriage.

Bryan Joseph Fagan( Attorney )

Bryan Fagan, a native of Atascocita, Texas, is a dedicated family law attorney inspired by John Grisham’s “The Pelican Brief.” He is the first lawyer in his family, which includes two adopted brothers. Bryan’s commitment to family is personal and professional; he cared for his grandmother with Alzheimer’s while completing his degree and attended the South Texas College of Law at night.

Married with three children, Bryan’s personal experiences enrich his understanding of family dynamics, which is central to his legal practice. He specializes in family law, offering innovative and efficient legal services. A certified member of the College of the State Bar of Texas, Bryan is part of an elite group of legal professionals committed to ongoing education and high-level expertise.

His legal practice covers divorce, custody disputes, property disputes, adoption, paternity, and mediation. Bryan is also experienced in drafting marital property agreements. He leads a team dedicated to complex family law cases and protecting families from false CPS allegations.

Based in Houston, Bryan is active in the Houston Family Law Sector of the Houston Bar Association and various family law groups in Texas. His deep understanding of family values and his professional dedication make him a compassionate advocate for families navigating Texas family law.