Army

November 1, 2012

Debt, divorce — who pays what?

Tags:
FH Legal Assistance Office, Staff Judge Advocate


Recently a client came to the Fort Huachuca Legal Assistance Division with a question about a credit card debt. The Soldier had gotten a divorce several years ago, and the divorce decree required the ex-spouse to pay the balance on the credit card. The Soldier had just gotten a call from a debt collector indicating the bill had been in arrears for several months. The debt collector demanded payment from the Soldier and was not interested in what the divorce decree said about the ex-spouse being responsible for repayment.

Unfortunately, this happens quite often in divorce situations. If a joint debt is made during the marriage, it is often made by a contract between the creditor and both spouses. Many times, when the marriage breaks up, the parties will enter into an agreement, or the court will enter an order, determining which party is responsible for paying each of the debts. However, the creditor is never a party to the agreement or the court action in which the order was entered. As a result, neither the agreement nor the court order is binding on the creditor. As far as the creditor is concerned, both parties are still liable for the debt. Since the creditor just wants to be paid, and doesn’t care who pays, the creditor will often go after both parties until the debt is paid in full.

There are a couple of ways for people to protect themselves from this situation. First, if at all possible, the best remedy is to secure from the creditor a release of liability for the spouse who is not going to be responsible for the debt. Sometimes, this will mean that the responsible spouse will have to refinance the debt in his or her own name. However, if the paying spouse doesn’t have good credit, this may not be an option. Sometimes, though rarely, a creditor may agree to simply release the nonpaying spouse from the debt. It certainly doesn’t hurt to ask, and if the answer is “yes,” be sure to get it in writing. An oral release is not legally effective.

Second, the nonpaying spouse may want to consider becoming the paying spouse. Agree to be responsible for the debt, conditioned on an agreement by the other spouse to pay you an amount equal to what would have been the debt payment. The upside of this arrangement is the paying spouse has control over the payment of the debt and knows that it gets done. The downside is that if the ex-spouse does not make the timely payment to the paying spouse, that person’s credit is at risk. The paying spouse will have to try to come up with funds to make the payment and then take action against the ex-spouse for reimbursement.

Third, if the other spouse is going to be responsible for making payments on a joint debt, the non-paying spouse should insist on an agreement that requires him or her to be provided with evidence, on a continuing basis, that payments are being made. Staying informed will help the non-paying spouse to take appropriate steps to be protected from default by the other spouse on these debts.

Those who find themselves in a situation in which an ex-spouse fails to comply with an agreement or court order and the creditor is calling to demand payment, the only possible remedy is to seek some accommodation from the creditor, such as a cash settlement or payment schedule. Of course, a person also should take action against the ex-spouse based on the agreement or court-ordered requirement to make payment on the debt.

Those who are in this situation may want to seek legal advice before doing anything else. Call the Fort Huachuca Legal Assistance Office and make an appointment to speak with an attorney. The number is 533.2009.




All of this week's top headlines to your email every Friday.


 
 

 
Maranda Flynn

Combat Lifesaver Course trains Soldiers to save lives on, off battlefield

Maranda Flynn From left, Fort Huachuca Combat Lifesaver Course instructors Sgt. James Atcitty, U.S. Army Medical Department Activity, and Sgt. James Fender, 111th Military Intelligence Brigade, wrap a casualty in a heat protect...
 
 
David Vergun

Senior leaders explain Army’s drawdown plan

David Vergun No commander is happy when notified that a Soldier from his or her command has been identified for early separation. But commanders personally notify those Soldiers and ensure participation in the Soldier for Life ...
 
 

Military Intelligence – Moment in MI history

INSCOM photos Lt. Col. Frank Moorman and his staff of the Radio Intelligence Section are pictured at American Expeditionary Forces Headquarters. Tactical Signals Intelligence originates in World War I July 28, 1917 On July 28, 1917, the American Expeditionary Forces G2, Brig. Gen. Dennis Nolan, tasked Capt. Frank Moorman, a Coastal Artillery officer, to form...
 

 
David Kamm, NSRDEC

Chow from a 3-D printer? Natick researchers are working on it

David Kamm, NSRDEC Natick food technologists already believe they serve up the best food science can offer. Now they are working to incorporate 3-D printing technology into foods for the warfighter. NATICK, Mass. — Army resea...
 
 
United Kingdom Ministry of Defense

Army researchers develop Cargo Pocket ISR

United Kingdom Ministry of Defense A British Soldier holds Prox Dynamics’ PD-100 Black Hornet, a palm-sized miniature helicopter weighing only 16 grams. Researchers with the U.S. Army Natick Soldier Research, Development and ...
 
 
U.S. Army IMCOM photo by Amanda S. Rodriguez

Civilian mentor program shapes Army installation management’s future

U.S. Army IMCOM photo by Amanda S. Rodriguez U.S. Army Installation Management Command mentors and mentees work on teambuilding skills, building a block tower in total silience, during the IMCOM Headquarters Centralized Mentori...
 




0 Comments


Be the first to comment!


Leave a Reply

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>


Directory powered by Business Directory Plugin