Say you recently got divorced, and your divorce decree states that your late husband (or wife), is responsible for your two visa card balances. Time goes on after the divorce, and you get a call from the credit card company stating that they haven't received a payment for the last three months on either of the balances. You explain to them that the divorce decree states that you are not responsible for paying the debt, your late significant other is. They rightly tell you that they are not part of that decree, and you are still responsible for making sure the payments are made on time on their joint accounts. Later on the late payments show up on your credit report, how is this happening?

If you have been recently divorced or are thinking about getting divorced, you need to look at your credit accounts that were opened while you and your not-so-significant other, were married.

There are two types of accounts, individual, and joint. Any time you apply for credit as a couple you will be asked which type of account you would like to open. Either way you can permit other individuals to use your account. So what are the pros and cons of both?

Individual account: If you apply for credit as an individual, you and only you are considered by the creditor for your credit worthiness. Your income, assets, credit history, and current debt, will all be taken into account. Your account will only reflect on your credit report. The advantage being, only you are can affect your credit. The disadvantages of this are if you have a low income, work at home, or work part-time, it will be more difficult for you to obtain a credit account without your spouse's income. Also, if you live in a community property state (Texas, Washington, Wisconsin, New Mexico, California, Arizona, Idaho, Louisiana, or Nevada), you may still be responsible for your spouse's debts if incurred during Marriage.

Joint account: You and your spouses income, credit history, debts, and assets, will be considered when determining credit worthiness. You and your spouse are also jointly responsible for seeing that the debts are paid, and it will reflect on both of your credit reports. The advantages include the fact that an application with two people's incomes and assets backing it is more likely to get approved with better terms than just one partners backing. The disadvantage being if two people applied for the debt, then two people a financially responsible for the debt, even thru divorce.

Make sure some of these things are taken in consideration if you are getting divorced, or just thinking about it. If you did obtain joint accounts while you were married, and your spouse was charged with paying them, pay attention to the balance, and make sure the payments are getting paid so it doesn't negatively affect your Credit Report.

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