When a couple decides to dissolve their marriage, they can expect to face a number of complicated decisions. One of these decisions is how to divide the assets they have accumulated while they were married. Each state has its own rules to follow, and couples can help themselves by remaining as open and agreeable as possible through the process of property division. In an equitable distribution state, like Pennsylvania, both assets and debts are divided in a way that is determined to be fair and reasonable by the court.
While each situation is different, in most cases, debt — including credit card debt — will be fairly divided between the spouses, even if only one of the spouses was responsible for amassing the debt. If an ex neglects payment on an account that bears the other spouse’s name, the other spouse may be legally responsible for the debt even though the court ordered the ex to make the payment. This is why it is important for people to get copies of any rulings regarding the division of debt.
In addition to dividing the payments due on credit card balances, a Pennsylvania court will divide any rewards or points those cards have earned. This may get complicated because it may mean the courts must assign value to the use of the points. It may also be true that credit card companies will not transfer the points if the courts assign them to the spouse who is not on the account. In this case, the court may need to adjust other assets to make the division of property fair.
More often than in the past, financial advisors are urging couples not to completely unify their finances. Keeping separate bank accounts, as well as separate credit cards, may make property division less painful in the event of a divorce. However, if one is facing a complicated divorce with assets and debts to divide, the counsel of an attorney cannot be overestimated.
Source: nasdaq.com, “Credit Cards And Divorce: What You Should Know“, Dec. 2, 2016