Any type of separation or breakup is certainly not easy and can take its toll emotionally, physically and even financially.  We've heard a familiar story over the years from clients that have gone through divorce:

"The divorce decree said my spouse was responsible for paying those accounts."

WHAT HAPPENS

The joint accounts that you had during the marriage get divided up during the divorce.  One spouse gets the Visa, Sears, and Chevron accounts to pay off; the other gets the MasterCard, Dillards, and Bally's gym accounts. 

Scenario 1
All of the accounts get paid off as they are supposed to per the divorce settlement, then they are closed.  Each former spouse gets a closed account in good standing listed on their credit report for the next ten years.  Happy Ending.

Scenario 2
One person pays off the accounts they are responsible for.  The other former spouse maxes out all of the joint accounts they can get their hands on, never pays the bill, ignores all the collection notices for those accounts, and basically disappears.  Because they were joint accounts, BOTH person's credit reports get all the negative information about the delinquent accounts.  And sometimes this isn't discovered until years later.  Not a happy ending; in fact, it's not even close to being over yet.

WHY IT HAPPENS
A divorce decree does not supercede a contractual agreement with a creditor.  The credit card company agreement stays intact even after a divorce.  If the account is a JOINT account, this means that both parties are equally liable for paying the debt, until it is paid off and closed.  It is usually reported to both people's credit reports.

If the account is in one person's name with the other as an Authorized User (AU), the account holder is solely responsible for the debt, even though both people can charge on the account.  The account will typically show up on both people's credit reports.  The AU can be removed from the account without closing it.  It will still show up on their credit report for about 10 years in whatever status it was last reported when they were on it as an AU; the account information will not be updated in the future.

WHAT TO DO
Here are some recommendations if you have joint accounts, are getting divorced, and splitting up the debt.

1) Try to get the account transferred from a Joint account to a single account in the name of whoever is responsible for paying it off.   NOTE: This is not always possible to do.

2) Close the accounts.  Even if there is a balance on them to be paid off, closing the accounts prevents future purchases and debt increases.

3) If you are concerned about the possibility of non-payment by the former spouse, and the accounts are still held jointly, monitor them.  Ask for, in writing, a duplicate statement to be sent to you each month, call the toll-free customer service number to hear the latest account information, or log-in online to check the payment status. 

Remember that any months of skipped payments can result in 30 day late payments showing up on BOTH of your credit reports for joint accounts, even if the account is closed.  Skipped payments can also result in late fees being added to the account balance.
NOTE: Accurate, negative account information can stay on credit reports for seven years.

You may want to consider making a payment yourself to avoid the 30 day late on your credit.  If so, keep track of it in the event you take future court action to recover the amounts you paid that they were responsible for.

4) During the divorce settlement process, request a timeline for debt payoff be included when dividing up the accounts.  Limiting the amount of time to pay them off can eliminate future debt abandonement by someone who is no longer cooperative.

5) Check your credit reports regularly.  Do it at least every four months using your no-cost annual reports.  Make sure no new accounts were opened jointly by the former spouse and that the settlement accounts are reporting as they should be while they are getting paid off.  If you notice an error on one credit bureau's report, send a correction request to all three, because chances are it's on all of them. 

6) Re-establish credit in your own name.  Having at least one major credit card and a retail account that you use ONLY to build your credit rating, NOT to carry debt, is an important part of your Financial Fitness plan.  Our Credit Analysis provides our clients with step-by-step directions to obtain and use credit cards as credit building tools.
NOTE: Too many applications for new credit can hurt your score.  See this information on Inquiries.

No it isn't easy and your future credit rating may not be at the top of the priorities during a divorce.  However, taking steps now to prevent as much additional debt and frustration as possible can lead to better credit scores in the future.

NOTE: This information is not intended as legal advice.  Please consult your lawyer for information specific to your situation.