I hear all the time from mortgage lenders that an item should not be on a report because it is not the borrower’s legal responsibility through a divorce. However, the truth is that creditors don’t care about that piece of paper! So, let’s explain the process so you know how and what needs to be done.
When someone is on a debt as a “joint” or legal responsible party of that debt, the judge can determine who is responsible for the debt through a divorce decree. However, it is the winning party’s responsibility to ensure that the spouse who is to assume the debt, removes them through refinancing or paying off that debt. If this does not happen, for as long as that debt is owed, the item will remain in both party’s names and the reporting will continue to report that item on their reports.
The creditor has no legal obligation to take that decree and remove the party from the debt. What needs to happen is the person who is responsible for that debt, either must pay the debt off, or they must refinance it into their own name. If they don’t do this, then they are in contempt of court and can face penalties in the courts with the judge that ordered it.
Unfortunately, this also requires that the removed person is dragging their ex back to court and have them be held responsible by the judge and they don’t often do this as it is timely and expensive. However, without this any missed payment or delinquency will continue to be a risk to the “winning” spouse. There are no walk arounds and typically if a spouse does not follow the orders of a judge and they do have to go back to court, most judge’s will rule in the favor of the violated party and leave the ex to be responsible to pay court fees and the debt for the lack of action in resolving the issue.
This is all the more reason to make sure everything else on their reports is in the best place they can be. On top of the negative items that are typically there in a divorce along with the other “liabilities” that still show up from the spouse, you can be waiting a long time to enjoy the great credit you deserve.
Let us help you and teach you how to have the great credit you deserve and how to go through the proper steps of getting rid of the “haunting” accounts that can lead you to credit doom!
