Steps To Protect Yourself From New Debt During A Divorce

download-1Financial problems can cause a lot of stress during a marriage, and it is no surprise than they can continue to add to the tension during a divorce, especially when it comes to debt. In New Mexico, debt from the marriage belongs to both parties because it is a community property state. This means that if your spouse continues to accumulate debt before you divorce, you’ll be on the hook for it, too. However, you can take some steps to protect yourself when it comes to new community debt.

The Temporary Domestic Order (TDO)

When you file for a divorce in New Mexico, you will receive a temporary domestic order (TDO). This order is meant to preserve the status quo and protect both spouses financially, and it prevents your spouse from running up a lot of new debt or moving any assets. It does not help, however, to stop your spouse from spending irresponsibly, especially if he or she did so during the marriage. While the TDO applies to all community debt, it comes up the most frequently with credit cards. It does not prevent creditors from taking action against you.  As covered above, court orders and your settlement agreement do not bind the credit card companies.  So debts must continue to be paid while the divorce is pending.

Divorce terms and your creditors

Technically, these orders can be enforced by the court, but the actual enforcement is often difficult and time-consuming. It can take weeks or months to even get to court the first time, and matters like these are rarely resolved at the first hearing. Because of the time and legal fees involved, especially after all the strain of the divorce on your finances, trying to enforce the court-ordered debt division with creditors is often not feasible. Your best bet is to make some moves to keep yourself shielded as much as possible, so you are not left dealing with creditors post-divorce.

How to protect yourself

Even though you cannot really protect yourself from debt that was incurred before you filed for divorce, you can take some steps to prevent more financial bleeding from now until the divorce is granted. See if you can get a court order that allows you to cancel all the credit cards you both have access to. This probably won’t be allowed under your TDO, which is why you need permission from the court before you do this. With the credit cards shut down, your spouse will have fewer ways of driving up the martial debt in your name.
Put your credit card companies on notice. Once you have a court order, be sure to put the fact that you are not longer financially responsible for the account in writing and that you want your name taken off of that account. Make sure you send this by certified mail, return receipt requested, and ask for a response in writing. You may have to be persistent to get a reply, but make sure you keep on it until you receive one.
Recovering from the financial impact of divorce is difficult enough on its own, and you do not want to add more debt to the mix. Consult an experienced attorney to help you keep your financial future as secure as possible as you go through your divorce.