For the first quarter of 2017, American households carried $764 billion in credit card debt, says the Federal Reserve Bank of New York1. If your estranged wife is doing more than her part to add to that debt load, what can you do about it? More important, how does her behavior put you at risk?
Estranged is a Strange Word
The word “estranged,” Merriam Webster tells us2, has two meanings, both of which may apply to your situation. Your estranged wife is alienated from you by a withdrawal of affection, leaving instead of love, a sense of indifference or even hostility. Your estranged wife can also be physically removed from what had been the normal environment of your marriage. Most lawyers use the word to mean she is out of the house and on her own, whether you two are formally separated or not. Where once your loving wife stood, you now see a stranger.
Is Credit Card Debt Shared in a Marriage?
The experts at National Debt Relief peg Virginia’s per-household debt at an astounding $6,397 for the first quarter of 2017. With national average credit card annual percentage rates (APRs) hovering at 16.06 percent, these debts will pile up. If your wife is an authorized user of the credit cards you two shared in marriage, she can continue to use them once she is on her own, unless you take steps to stop her.
Debt and Divorce
In Virginia, everything in a marriage is divided equitably (not equally; equitably, and there is a difference). You can have marital property, like the sofa and love seat you two bought together for your first home. That is shared property.
You can bring property to the marriage that is yours alone, called separate property. Say you owned a fishing boat since college; that stays yours. You can have hybrid property, in which something you had (separate property) created shared property in the marriage. Say, while married, you used that fishing boat to catch and sell fish as a sideline; the profits from that will be hybrid property, because your ex-wife can argue that her support of your endeavors made her a partner in generating the fishing income.
The same is true with debt — it can exist before your marriage, during your marriage, and after. Shared, marital debt is divided much as assets are, which usually means as close to 50-50 as possible. Personal debt is your own headache. Those student loans you took out from the Acme Fishing School? Yours. Her auto loan for the clunker she was driving when she met you? Hers.
Separation Shopping Spree?
You two decide your marriage has faltered and decayed to the point where you separate. She moves out and takes her gas station card, department store card, and bank credit card with her. Her name is imprinted on all three cards. You two have both your names on all three accounts. She is an authorized user, so she goes out and starts buying five-gallon cans of gasoline, entire wardrobes of designer clothes, and plane tickets to Honolulu. She figures, “Why not? It will be divided evenly, so I am getting these at a 50 percent discount.”
Nope. Once you note the date of separation, anything she (or you) incurs after that date becomes personal debt, not marital debt. The Virginia courts will not look kindly on her shopping spree, and assign all those purchases to her alone.
Great, you think, at least you will not be paying for all that stuff she bought. And yet, not so great — she can trash your credit history along with her own, if she chooses to. Say she ran up $600 in gasoline credit card purchases after you two separated. She decides not to pay a dime, but the bills keep coming to your marital home address. If she lives there, she could tear up the bills. If you live there, you will have no way to explain to the credit card company that she is responsible for her portion, since she is an authorized user.
Does It Matter who was the Primary Account Holder?
Being responsible with credit begins when you open the account in the first place. Hindsight is always 20/20, but you essentially had four ways to open the account:
- You were the primary account holder and she was an authorized user
- You were joint account holders with equal power and responsibility
- You co-signed for her because her credit was shaky
- She co-signed for you because your credit was shaky
The experts at Bankrate.com caution against co-signing for anyone, even the supposed love of your life. Extricating yourself from a co-signed credit card requires her cooperation.
Those same experts also say that both joint account holders can still be hounded by credit card debt collectors for the other person’s share of any debt, despite any property settlement agreement that may be in place.
Again, with perfect hindsight, the ideal way to open credit card accounts is with you as the primary account holder and your wife as the authorized user. This way, when your marriage suffers, you can quickly close the account without suffering financially. Otherwise, you will have to wait until the divorce proceedings to have a judge assign her post-separation debts as her own.
If possible, sit down with your estranged wife and explain how you both are at risk from her outrageous spending. She will need to agree to close any co-signed or joint accounts.
Get the Help You Need at The Firm For Men
As lawyers exclusively representing men in Virginia separations and divorces, we at The Firm for Men have seen many instances of deliberate financial abuse by estranged wives. Contact The Firm For Men online or call us today, at 757-383-9184. We will be happy to share some strategies you can use, right now, to protect yourself.