Credit Card Debt and Divorce

Credit card debt and divorce don't go together like "horse and carriage," "love and marriage," or whatever that old song is. Credit card debt and divorce do not make you want to hum a catchy little tune. But I will think of the check inside this envelope as a Christmas present to myself. 

I've lost more than a little sleep over the mounting credit card debt that is accruing in my name due to an unclosed account leftover from my marriage. Styling itself as a sort of Catholic Pope of the financial world, U.S. Bank, as is typical of credit card companies, does not recognize divorce. You can read more about that HERE if you like. 

I thought the document my attorneys prepared governing the division of joint assets had me covered, but I was MISTAKEN, so I've done what has served me best in my divorce--relying on my own gut.  In the course of my marriage I possessed little talent for reading the writing on the wall, but in the four years and seven months of the divorce process, I've been schooled.

Since my email of more than a month ago to the co-owner of the account went unanswered, I figured the ball is squarely in my court. After emailing him again yesterday morning, I closed the account and made a rather substantial payment on the balance in order to keep the peace. Worth it.

A open credit account in the wrongs hands equals the destruction of my credit score, and possibly the derailing of plans that will allow me to move to a house where my mom can live with me. I won't let that happen.

An excerpt of my letter, for anyone who may need it, is below:

I am enclosing a copy of the final decree of divorce and an excerpt from the document detailing the final division of joint assets in which XXXX is assigned responsibility for this account. Unfortunately, there is no incentive in place for XXXX to close the account, and I fear the balance will continue to mount, damaging my credit even further. I am also enclosing a check for XXXX.00 to be applied to the current balance of the card on the condition that the account be closed immediately to all future charges so that no further indebtedness can be incurred. You may continue to send future bills to XXXX at the address of record. 

I also ask that this letter and its supporting documents, including the enclosed photocopy of my check, be entered into my file. My current name is XXXX and the last four digits of my social security number are XXXX. My current address is XXXX.

I would very much appreciate a response to this letter.

Credit Where Credit is Due

Below is the exact text of an email I sent yesterday:

Hi,

I tried again recently to get my name taken off our joint credit card. No go since I am joint owner of the account. 

It is possible to close the account even though a balance remains. Bills would continue to arrive, etc.

Would it be all right with you if I closed it? It's important to my personal and financial well-being.

Please let me know.

I have not yet received an answer. But my brain is working overtime on this thorny issue. I have not used this card since October of 2008, and the balance continues to grow and grow. 

Credit card companies do not recognize divorce, which I've written about here,  and here. 

Yesterday I called the credit card company for advice. "You could get an attorney and take him to court," the young woman said.  Ha, ha, ha, I said, not going into any detail about the fortune that I've already spent on my divorce. But, yes, I thought, after I hung up, what about the Stipulation to Divide Joint Assets? Didn't my attorneys include some provision about this credit card, and yes, I will invoke whatever solution lies within this legal document, because several times I expressed my concern over this card to them, and yes, that's where the solution is!  Here is what I found in the Stipulation. 

Credit card account xxxxxxx : (Respondent shall close the account upon payoff by Respondent)


HMMMM. Toothless is the word that comes to mind. 


Meanwhile debt continues to mount in my name while I ponder my options. One option I am NOT considering is going back to my attorneys for advice on this one.

It's Turdsday. Shit I've Learned about Divorce #4: Money, Taxes, Joint Accounts, Credit Cards and Other Horrors

Taxes:
When my marriage broke up, I had all the financial trappings of a big fat life: a CPA who prepared my taxes,a financial advisor, a team of divorce lawyers. Imagine my surprise when the end of 2008 rolled around and I filed my first individual tax return in thirty years. Not one of those professionals had any inkling of how naive I was. I had no idea of how naive I was--cuz that's what naive is. You don't know what you don't know.


You were supposed to being paying quarterly taxes all year, the CPA said.
Yes, alimony is taxable at the full rate, the divorce attorneys said.
You need to come up with how much money?!?! the financial planner said.
I don't have any control over the tax code, someone else said.
Holy shit, I said.


Paying my income tax and the penalties I accrued from failing to pay estimated quarterly tax wiped out every cent I had saved from my rather fat alimony that first year on my own.


I've recovered from the tax debacle of 2008. But I managed to get myself into the penalty box again in 2009 when I goofed up my quarterly payments to the State of California. Here on the left coast of the country, a quarterly payment is not really a quarter. You pay nothing in the third quarter. That's because you were supposed to pay 40% in the second quarter. And, just by the way, the first and fourth quarter, you pay 30%. Um. For all I know it's that way in every state in the union. But I didn't know what I needed to know when I should have known it.


Joint Accounts:
I didn't know what to do with the joint checking accounts. After my alimony began, I quit using them. But it seemed weird to take my name off them. Someone else's name was still on them, and the accounts were being used by him. Maybe there was some strategic smart attorney something I didn't know, and I should leave things alone.Hmmm, the banker said. He could overdraw this account and you could be liable. That didn't happen. Thank god. But it could have.


Credit Cards:
When you get a credit card with someone, you might be just a simple little authorized user. It's a pain, because if you call the credit card company for any reason, you're just a big fat nothing. I'm sorry, they'll tell you. We have to speak to the owner of the account. But I'm his wife, you'll say. Who? Oh, that doesn't matter, they'll say. But if you get divorced, there's still a lot of fancy dancing to get yourself off the account. And what goes on with that account can affect your credit rating.


If you're not just an authorized user,you're probably a co-owner of the account. You can't get your name taken off. Period. We don't recognize divorce, the credit card company will say. They'll go on to say that the agreement you entered into with the credit card company supersedes divorce. You are liable even if you shredded the card long ago. Now you have to pay your divorce lawyers to help you settle this one.


Other Horrors:
Health insurance is at the top of my list of "other horrors." I won't even go into it. But think about your situation. Your health and how you insure it, and how all of that will change when you are divorced.


I wish you the best of luck.
Just telling you some shit you might want to know.




My divorce advice disclaimer: I am not an attorney, a paralegal, or a legal secretary. Nor do I possess any legal education or credentials of any kind other than having been married to an attorney for three decades and immediately thereafter involved in divorcing him for the next four years. My advice is based solely on my own experience and falls under the broader life heading of Damn It,  If Only I'd Known Then What I Know Now.

Credit Card Company Caves to Divorcée's Demands

I won.
But if no one tells you you've won, is it really a win? I think perhaps it is.

Back in May when I was already nearly three years into the warped world of divorce, it suddenly occurred to me that I still shared credit card accounts with Mr. Ex. I had tossed the cards into a box under my desk when I began receiving alimony, but he continued to charge things as if he was channeling Eloise in her room at the Plaza. The debt he racked up was impressive--and my name was attached to it.
"We don't recognize divorce," one of the credit card companies told me. My contract with them superseded  a piece of paper from  Los Angeles Superior Court, they said. My determination supersedes your dictatorial attitude, I thought. I had already gone to Mr. Ex's office in person to get him to sign their form, and when that didn't work out, I went again.
I worked diligently on  second my letter to that financial fiefdom known as C____ that is holding on to some views on marriage and divorce that belong in the dark ages. Then I let it go until I began pawing though my "divorce in a box". (Everyone needs a hobby, right?) That's when I found that I had a need to view an old credit card statement I couldn't seem to find, so I tried to view it online--without success.
I called customer service.
"I'm sorry, you're not allowed to view this account because you're not on it," the woman on the line said.
"Really?" I said. And then I asked her if she could confirm that my name had been recently taken off this account and that my ex-husband was now solely responsible for it.
"No," she said, "I can't do that because you're not on the account.
"Thanks very much," I said.

Another Autograph

Downtown again, papers in hand for Mr. Ex to sign. His secretary riding a lunch rush elevator between me  in the lobby and Mr. Ex ensconced above us in one of his two offices in a shiny downtown high rise. I had three forms for him to sign. Two versions of a form designed to release me from responsibility for a joint credit card account I haven't used since my alimony began, and a form from an investment account that has been designated as my sole and separate property by an Interim Division of Joint Assets signed, sealed, and delivered by the L.A. Court.  It should have been simple. It wasn't.
Mr. Ex had already signed off on the Interim Division of Joint Assets which awarded a few things to him and a few to me with more yet to be divided if he's ever cooperative enough to do so. The investment firm had already received the official court documents, but they had a little form of their own for Mr. Ex. to sign. "Where are the forms for the things that I get?" Mr. Ex reportedly asked. "I'm not signing her form until she signs forms saying that I get my things."
Um. No forms seem to be necessary for you to get your things.
Poor secretary.
I called my attorney and left a message suggesting we look into a contempt of court filing. I called my financial guy.
About an hour later, thanks to the financial guy, things were sorted out--at least for the investment company's form.
As for the credit card account, Mr. Ex won't divulge his "gross household income"--a necessary number before the credit card company agrees to let him be solely responsible for the account. But I'm not giving up. I'll figure out a way.
Meanwhile, it cost me 13.50 to park. If I asked him to reimburse me, do you think he would?

Divorce Advice: My Half-Dozen Rules

No one's asked, but I think I've learned a few things as my divorce has dragged on through these past three years.

Even if you think you were married to the most upstanding, moral, wise, and essentially kind human being, he has probably changed. At the very least, he's in a crisis and not thinking with the "big head." The head he is thinking with is no longer the least bit concerned with you or your well-being.

1) As you prepare to move out--or as he moves out, be absolutely certain you have made copies of everything--or just take the originals. You can make copies later and see that he has whatever paperwork he needs at some later point if you are feeling generous. You need everything. Bank statements (or access to on line banking--and if you do have online access change those user names and passwords before he does), credit card statements, insurance documents, absolutely everything financial. You need to continue to keep tabs on all financial transactions from the date of  separation until everything is settled. I wish I had taken the entire filing cabinet. Don't forget to take his cell phone records.

2) If separating your finances is going to take some time, consider canceling  all credit cards. If you need the credit until your spousal support kicks in, think about adjusting the credit limit. I now could be liable for  tens of thousands of dollars of credit card debt racked up by  my ex because I didn't take any action. You have to think clearly about what you need and what could happen as an outcome of any choice you might make. I wish I had simply taken half of every liquid asset immediately. It would have been appropriate to my circumstances--30 years of marriage, 20-some years of raising children while not working outside the home, community property state.

3) Don't be overly patient. A reasonable amount of time for Mr. Ex and me to settle our financial affairs might have been 6 months or so. I've now spent so much on attorney fees that I could have gone to trial at the 6 month mark and ended all of this. Go to trial if there's a possibility of things dragging on  and on.

4) If your ex is planning to remarry, use the time pressure inherent in this situation. DO NOT BIFURCATE.  Bifurcation means that the dissolution of the marriage is on a separate timetable from the settlement of financial affairs. Don't let your marriage be dissolved until he has paid up by dividing all joint assets and agreeing to alimony. My attorney suggested bifurcation. It's common. It's what people do. Don't do it.

5) Don't be so damn nice.

6) Don't be nice at all.