At the end of a marriage, one must consider not only the legal and personal ramifications of the proceedings themselves, but potential financial benefits and pitfalls divorce may offer. Dividing debt among separating spouses is no guarantee that creditors cannot and will not pursue collection and other credit activity with both spouses, as the law considers any debt incurred while married to be the responsibility of both spouses.

While New Jersey is not a joint property state, a divorce decree means only that the spouses are no longer married. In cases where spouses have joint accounts or are authorized users, creditors are required by law to report any delinquent payments or other credit issues in both parties’ names. Maintaining regular payments on any joint accounts helps ensure that a given spouse’s credit is not damaged if the other fails to make payments for any reason.

Transferring accounts from jointly held to individual accounts upon dissolution of the marriage may be an option depending upon a number of factors. A creditor may not lawfully transfer an account from one type to another because of marital status change, but is permitted to do so at either spouse’s request. Joint bank accounts and credit cards are examples of accounts that should be changed as soon as possible.

Property distribution is one crucial factor in divorce proceedings, and an attorney might begin by assessing both the individual and joint financial health of the spouses. The attorney may recommend an equitable disposition of debt and assets, contingent upon acceptance by both spouses. In cases where an equitable disposition is impossible for any reason, the attorney may recommend a court-ordered distribution of assets and debts to best serve the interests of all parties.