Creditors care about original loan documents, not court agreements

In divorce, lenders will go after all who agreed to pay

The Credit Guy columnist Todd Ossenfort
Todd Ossenfort has been chief operating officer for Pioneer Credit Counseling since 1998. He writes our weekly "The Credit Guy" column, answering reader questions about credit counseling and debt issues.

Ask a question.
Question for the expert

Dear Credit Guy,
What if your spouse is an authorized user and you sign a separation agreement that says she is to be responsible for the account, but she is then irresponsible? Does the legal agreement have any standing on charges she makes? -- Timothy

Answer for the expert

Dear Timothy,
Unfortunately, the only legal agreement that means anything to your creditor is the cardholder agreement you signed saying you would be responsible for the account -- including any charges made by any authorized users added to the account. The only way the legal separation agreement will help with paying your creditor is if you take your spouse to court and request that the court enforce the agreement. This can be expensive, and I would not recommend it unless you have no other choice.

The good news is that you said your spouse is an authorized user. As the cardholder for the account, you can have her removed from the account and her credit card associated with the account canceled. Before you take this action, however, I'd recommend that you do two things first. One, check with your attorney to determine if removing your spouse from the account will violate any terms of the separation agreement. If it does, you may need to file an amended agreement with the court.

Second, communicate with your spouse and let her know that you are removing her as an authorized user and canceling her card. Explain that you are only taking this action because you cannot afford to pay her charges and are taking the action to protect your credit.

Next, take a look at any other joint credit accounts that you might have with your spouse. Review the accounts for which your spouse is responsible. I'd keep a close watch on those accounts to assure that they are being paid as agreed. Particularly, assure that any secured loans such as your mortgage(s) and car loan(s) are being paid.

Since you are only legally separated, it sounds as if you may be working on keeping your marriage together. If so, you will want to keep a cool head when communicating about anything financial (and other issues) with her and try to remain calm, even if she doesn't. Money trouble is one of the top five reasons people get divorced. If money has been a difficult subject for you and your spouse during your marriage, you might even consider having your attorney communicate with her about the authorized user credit card and any other financial issues that need to be addressed.

Another thing to keep in mind with debt among separating or divorcing spouses is whether you live in a community property state. If you live in Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington or Wisconsin, you can be held legally responsible for debt acquired during your marriage, even if the account is solely in your spouse's name.

Should you be moving toward divorce, it is a good idea for any joint credit card accounts to be closed and the balances transferred to accounts in each of your names. For example, if you agree to split the balance of your cards, transfer half the balance to a card in your name and the other half to a card in her name. Make sure this is done before the divorce is final. This simplifies things and keeps one spouse from being able to cause damage to the other's credit.

Take care of your credit!

See related: How being an authorized user can hurt your credit score, Dividing credit card debt in divorce, Protect your credit score during divorce

Meet's reader Q&A experts

Does a personal finance problem have you worried? Monday through Saturday,'s Q&A experts answer questions from readers. Ask a question, or click on any expert to see their previous answers.

Join the discussion
We encourage an active and insightful conversation among our users. Please help us keep our community civil and respectful. For your safety, do not disclose confidential or personal information such as bank account numbers or social security numbers. Anything you post may be disclosed, published, transmitted or reused.

If you are commenting using a Facebook account, your profile information may be displayed with your comment depending on your privacy settings. By leaving the 'Post to Facebook' box selected, your comment will be published to your Facebook profile in addition to the space below.

The editorial content on is not sponsored by any bank or credit card issuer. The journalists in the editorial department are separate from the company's business operations. The comments posted below are not provided, reviewed or approved by any company mentioned in our editorial content. Additionally, any companies mentioned in the content do not assume responsibility to ensure that all posts and/or questions are answered.

Weekly newsletter
Get the latest news, advice, articles and tips delivered to your inbox. It's FREE.

Updated: 12-19-2018