Divorce and Bankruptcy, Divorce Decree Does Not Affect Liability to Bank!

Question:

My divorce was recently finalized; am I responsible for all debt that my ex-husband was awarded after he files for bankruptcy?

Answer:

I assume what you mean is that in the divorce decree, the Family Court ordered your husband to pay certain marital debts? The problem you encounter is common, unfortunately. The divorce decree is only binding between spouses. However, the divorce decree has NO affect on the relationship between the spouses and the lending banks (e.g. the credit cards). So, if the debts in question are joint debts, then yes, you would be liable to the bank for those debts.

For example, while married, the two of you had a joint Chase MasterCard with a $10,000 balance. In the divorce decree the Family Court Judge orders your husband to pay that credit card; your husband files bankruptcy. Your husband will have discharged his liability to Chase for that debt, so Chase, legally, will now come after you for the balance. However, in these circumstances, you can generally go after your ex-spouse for civil contempt if he fails to pay the debt. After all, the Family Court Judge has ordered your husband to pay the debt. But until he does so, Chase can take any collection action it wishes against you to collect that debt.

Tragically, divorce is one of the leading causes of bankruptcy. If the marital estate has significant debt, it is usually unavoidable that one spouse, and usually both spouses, need file bankruptcy. The divorce ends the marital relationship and the bankruptcy cleans up the financial mess so each spouse can move on as cleanly and unscarred as possible.