My Ex Is Using My Credit Cards after Our Divorce!

Unfortunately, divorce almost always brings with it some degree of contention. Regardless of what the former couple disagrees about, it usually comes down to a “he said, she said” type of dispute.

Sometimes, however, there is legal recourse for post-divorce behavior that simply crosses the line. Take, for example, a woman who, upon setting out to clean up her credit report and boost her score, discovered that her former husband had been using her credit cards quite liberally well after they split up.

While, yes, there can be a bit of ambiguity when it comes to using shared cards in the time period after a married couple decides to part but before the Final Judgement of Divorce has been entered, the law speaks loud and clear after the divorce is final.

Any use of your ex-husband or ex-wife’s credit cards (that are in his or her name only) after you divorce is specifically disallowed. In fact, it’s against the law and reeks of identity theft.

Do some married couples use each other’s credit cards while they’re married? They do – even if the credit card in question is not a shared card and only officially “belongs” to one party. This is legal if the non-card-holder is named as an authorized user on the account.

Example: Husband goes out of town for the weekend and leaves his credit card for his wife to use for shopping. As long as she is an authorized user on his account, this is perfectly legal. However, she must sign her own name on any receipts as opposed to forging her husband’s signature.

Even if you’re currently happily married, it is generally considered unwise for you to utilize your spouse’s credit card (that is in his or her name only) if you aren’t listed as a user of the credit card. Some couples do it anyway because most merchants assume that the cardholder gave permission to the spouse to use their card. Simply calling your credit card company and adding your spouse as an authorized user is easy to do and can eliminate any potential problems.

After you are officially divorced from your spouse and are holding the Final Judgement of Divorce in your hands, there should be exactly zero further use of the other party’s credit card. This is true even if you were listed as an authorized user while you were married. Should your spouse forget to remove your name from their authorized users list, this does not in any way mean that you may continue using your ex’s credit after divorce.

An ex-spouse utilizing your credit card falls under the category of a criminal offense: identity theft. It is no different than a complete stranger stealing and using your credit card(s). If this has happened to you, the next step you should take is filing a police report and sending a copy of the police report to the credit reporting agencies. Working with a credit repair specialist will help you get the debt removed from your card and you may even be successful in making your ex pay for the charges.

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Financial Consequences of a NJ Divorce from Bed and Board

New Jersey couples who want to separate but not completely divorce have the option of choosing a legal process called divorce from bed and board. This is New Jersey’s version of a legal separation.

Why not just sever all ties and get divorced?

While there are many reasons why a married couple may not be ready to commit to a final divorce (irony noted), for the purpose of our finance-focused blog, we’re going to, as usual, hone in on MONEY.

Most spouses who are interested in a bed and board divorce are generally still amiable and see the benefit of working together to end their marriage in the best financial way possible for both parties.

Health Insurance Benefits

Probably the biggest money-saving reason to consider a divorce from bed and board is so that the dependent spouse can retain health insurance benefits even after the couple separates. Oftentimes, married couples have one insurance policy through one spouse’s employer. A bed and board divorce is especially applicable in cases wherein one spouse was a stay-at-home-parent or was otherwise unemployed in the capacity that would allow them to acquire health insurance of their own.

Private health insurance coverage is expensive. Divorcing couples in New Jersey in which the dependent spouse needs access to healthcare on a regular basis (ie. those dealing with a chronic illness) can choose the limited (b&b) divorce option, allowing the dependent spouse to remain covered under their working spouse’s policy until such time that he or she is able to obtain independent coverage.

Tax benefits

New Jersey homeowners who are joint owners due to marriage may be unsure how they want to divide the marital home. Moving from one household into two is, as you can imagine, enormously expensive.

Some married couples who no longer wish to be married recognize that it is wise for them to temporarily continue owning property together. This may mean that both spouses remain living in the marital home until both parties have a better hold on their independent personal finances. Additionally, continuing joint ownership of the marital home helps couples avoid property tax repercussions because the IRS views a divorce from bed and board as identical to a legal separation.

Retaining joint home ownership also gives couples who want it the time they need to transfer the title from both spouses to one spouse. This is because there are generally no time limits on property transfers between spouses who are divorced from bed and board in New Jersey.

Survivor benefits

A limited divorce from bed and board allows survivor benefits on many pension plans to remain unchanged. This is also true of many federal and social security retirement benefits. This can be very important for older couples who are nearing retirement age as well as younger couples who have children.

Although it is true that a divorce from bed and board offers many financial advantages, it is important to work with a family law attorney who has experience in this arena. It is crucial to be sure of the language in your specific benefit package(s) before making any decisions. If your personal finances are keeping you from getting the final divorce you want and need in order to move on and be happy, you may also want to consider filing for NJ bankruptcy.

 

 

Image: “Marriage Rings” by Robert Cheaib is licensed under CC by 2.0

Divorce and the Stay-at-home Mom: Your Financial Rights

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Although we are not a family law firm, a number of our clients are recently divorced. Divorce can do a number on anyone’s finances for a variety of reasons, and many divorcees eventually file for bankruptcy in order to get a fresh start.

Today, let’s take a step back from bankruptcy and take a look at how to get through the divorce process itself. If both spouses are wage earners who then move into separate residences, the financial burden on each person suddenly becomes much higher than it was while supporting only one household with two incomes.

Even more challenging is the experience of the stay-at-home mom who has heretofore relied on the income of her spouse. Naturally, the stay-at-home mom (or dad) is, by definition, not employed outside of the home and therefore has no income of her own.

What rights does a stay-at-home mom have during a divorce?

When a couple makes the collective decision for one parent to stay home to raise children rather than work a traditional “job” with a paycheck, the stay-at-home parent becomes entitled to part of the working spouse’s income. Giving up years of work experience and potential earnings to care for the couple’s kids is worth something if and when the marriage fails.

Although a parent who has been out of the work force for many years may need to explore employment once the divorce is final, this will not happen during the lead up to divorce. The working spouse will be required to continue paying all of the household expenses throughout the duration of the divorce negotiations.

Non-working parents can also petition the court for temporary spousal support before the divorce is final. This money is paid by the wage earning spouse so that the stay-at-home parent can afford food and basic necessities.

Once your divorce case reaches the court system, many financial decisions must be made regarding child support, alimony, equitable distribution, the marital home, joint debts and more. During this time, a judge will determine if the stay-at-home parent is “employable,” and if so, what her earning potential is.

If the stay-at-home parent has never been employed and has always been dependent on her spouse’s income, alimony is likely to be granted. This is especially true if the unemployed parent has no college degree and zero work skills.

A stay-at-home mom with a college degree may still receive alimony along with child support, but the amount of alimony awarded will likely be lower because her degree gives her potential to find a decent paying job.

If you are currently a stay-at-home mom who is facing divorce, know that you will not be left on your own with no money to support yourself and your children. Dedicating a number of years of your life to raising your children is an important decision that you and your husband likely made together. Regardless of who filed for divorce, you can breathe a sigh of relief knowing that there are laws in place to ensure that you’ll be able to pay your bills.

Been all the way through a divorce and are now looking to improve your overall financial outlook? Filing for bankruptcy post-divorce is often a good decision. To learn more about whether bankruptcy is right for you, shoot us a quick message. We’ll consult with you free of charge.

 

Image credit: The Hidden Collection

My Ex Owes Me Money: Will I Ever Get it Back?

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Often times, when a married couple decides to split up – the dissolution of the marriage takes a significant amount of time. This lag period can be extremely difficult for people who are ready to move on (and away) from each other. In fact, many divorcing couples actually end up living together for much longer than either party would like – due to entangled finances, lack of substantial income, shared debts and convenience.

It’s a rare couple who can make it through a time period like this without at the very least getting into some heated arguments. Knowing that you’re no longer a romantic couple but having no other option but to continue living under the same roof can create an amazing amount of psychological strain. This can lead to increased fighting or deafening, never-ending silence.

On the other hand, there are couples who mutually acknowledge their need to “uncouple.” While recognizing that they are no longer working well as a pair, they still manage to remain civil and often even remain friends. Obviously, this type of split is preferable to the former, more contentious model, but it does invite problems of its own.

As romantic love fizzles out and a more business-like relationship takes hold, discussions shift from sharing your inner thoughts to who’s going to pay which monthly bills before the divorce is final and the Property Settlement Agreement is in place. It is during this delicate time period that clear communication is needed more than ever before, especially regarding finances.

I lent my ex money during our separation: will I ever be able to get it back?

Sharing finances is extremely common in the months/year (or so) after a couple has made the decision to divorce. Entangled bank accounts and bills are sometimes the last things to separate during a split, especially if one spouse makes significantly more money than the other.

During this very sensitive time, it’s quite common for the spouse with the higher-paying job to help out the other spouse until s/he can get back on track. What may have been normal financial practices during the length of the marriage may now take on terms like “loan,” “borrowing” and “I’ll pay you back.”

It’s fantastic if a divorcing couple can manage to put their differences aside in order to see each other to the finish line with both parties in good financial standing. Something important to know, however, is that it’s kind of impossible to “loan” your legal spouse money. As long as you were still legally married, there is no such thing as “loaning money” from one party to the other. All money within the marriage belongs equally to both spouses until such time as the Final Judgment of Divorce is received.

If you’ve lent money to your “ex” when s/he is technically still your spouse, chances are high that you’ll never see that money again. Count yourself lucky if your “ex” is a good-hearted person and at some point in the near future has the ability and the desire to settle up any ‘oral agreement’ loans that were negotiated during your separation.

 

Image credit: Quazie