Debt And Divorce

Debt and Divorce

Saturday, 16 January 2010 12:00

Divorce is not just about dividing up wealth. Sometimes the cause of a break up has been debt, and this problem does not disappear on divorce.

If you are considering Divorce, here are some initial steps you should consider are:

Draw up a detailed list of your outgoings and incomings (see our Income Requirements spreadsheet) on a monthly basis to establish your financial position. It is essential that you include all your outgoings, not forgetting incidentals like birthday and Christmas presents, magazines, newspapers etc.
Cancel all joint credit cards – you will be similarly liable for any expenditure incurred by the holder of the credit card.
Ensure that all joint bank accounts require two signatures for any money to be withdrawn.

If you fear that your partner may make your debt situation worse, you should take steps to avoid this to protect the family's financial position. You are jointly liable for debts when you are both signatories.

What if there isn't enough money to support two households?

By drawing up a list, you may identify a shortfall that has or could result in debt problems.To resolve debt issues you should always begin with looking at ways of increasing your income, for example:

Could you increase your hours at work?
Are you claiming all the benefits you are entitled to?
If you are living on your own, have you applied for a reduction in your council tax?
Could you take a mortgage ‘holiday’?
What about changing your mortgage to interest only?
Have you checked your tax codes?

A court order for temporary periodical payments called ‘Maintenance Pending Suit’ can be applied for if your divorce is going to take time, or if you are unable to financially support yourself during the divorce process.

Claiming Benefits

Many people do not claim benefits to which they are entitled because they wrongly assume they cannot claim anything. It is always worth checking your entitlements to make sure you are receiving everything to which you are entitled and your local Citizens Advice Bureau will be able to help.

Debt Advice at the CAB

To find out more about your options for dealing with debt in England, Wales and Northern Ireland, see Help with debt. You do not need to pay for debt advice. Your Citizens Advice Bureau gives free, independent and confidential advice. They can help you work out repayments and negotiate with your creditors. For details of your local CAB, including those that give advice by e-mail, click on nearest CAB.

Debt Advice on the Radio

Listen to Exeter FM this Sunday when Sue Ellingham and Chris Griffiths from the CAB will talk about Debt and Divorce.