While no debt is pleasant, this is probably one of the least fun.
After months of heartache and negotiation, you walked out of the courtroom with the judge's final word: you are officially divorced.
The child support and visitation has been determined and your assets divided.
While divorce is rarely a happy occurrence, most couples are relieved to have closure.
What you may be overlooking, however, is the impact of the situation on your long term finances.
You could have debt that is lingering, as well as financial pitfalls that can continue to haunt you.
What About Joint Debt?
The judge probably made a ruling about the debts and assets that you held together as a couple.
While you may know what is supposed to happen with things like your mortgage, you may be at risk if that agreement isn't carried out as ruled.
This can leave you with negative credit reports, as well as hurting your ability to move forward in your new and independent life.
When it comes to things like your mortgage, there is no other way to handle it than cooperating.
If you can agree to it, it is best to have these shared expenses taken out of each of your bank accounts automatically. That will ensure that late or missed payments don't happen.
Also, one of you may want to buy out the equity of the other so there is a clean break and line of responsibility.
Change Accounts and Names
You have a good deal of personal responsibility to know what the risk of divorce debt is, as well as the best ways to mitigate those risks.
First, get a clear picture of what accounts you held jointly and get your name off those books.
Whether or not your divorce is legal, being listed on a joint account can lead to even more divorce debt.
If you are afraid that you are missing some, request your credit report.
In fact, do that regularly to make sure there aren't things being attached to you that you aren't aware of.
Finally, open all new accounts, not linked to any divorce debt, and change everything to your new legal name, if you are woman.
What About the Attorney?
In most situations, you had to pay a retaining fee to your attorney.
This is almost an essential piece of divorce debt, as they helped you to navigate the process effectively. Now that the process is over, ask your lawyer about payment plans.
Many attorneys truly care about their clients and they will be able to work with you to pay down the final amount.
Divorce is a long and tedious process, filled with emotional angst and upset. Being left with debt after it is all over can seem like a slap in the face.
However, it must be faced and dealt with. By going into the process with your eyes wide open, you are much more likely to be effective at eliminating and avoiding as much divorce debt as possible.
This doesn't have to be a financial disaster, if you play your cards right.
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