Are You Liable for Your Spouse’s Credit Card Debt?

When “mine” and “yours” becomes “ours” in a marriage, undoing this financial entanglement can be quite complex, especially if you intend to get divorced. If your spouse has significant credit card debt, you may wonder who will be legally responsible for paying this debt. You may have another question: How to settle credit card debt? Even if you’re a millionaire, what would you do with one million dollars if you don’t have mental peace. 

Credit card debt can sneak up on you. Also, note that it can become a huge problem for many people. While many people make irresponsible purchases, sometimes, overwhelming credit card debt may accumulate for many other reasons.

For instance, if your kid needs a tonsillectomy or some other procedure, and you do not have health insurance coverage or a substantial sum of money in your bank, what will you do? Did you know that medical bills are one of the underlying causes of high credit card debt in the US? Another reason is a loss of income that can necessitate excessive credit card usage.

When it comes to marriage and debt, things can get complicated. Under certain circumstances, you may be held liable or responsible for your spouse’s credit card debt. Keep in mind that whether you are on the hook for your husband or wife’s credit card debt depends on many factors, such as:

• Where you reside
• Whether it’s a joint account 
• Whether you are a cosigner on the debt
• Whether the credit card debt was formally assigned to you during your divorce proceeding

If your spouse can’t pay their credit card debt, are you liable? Remember that the answer depends on various factors, including the US state you live in. For example, in Georgia, a wife can’t be held responsible for a husband’s credit card debt if she has not signed a binding contract with the credit card issuer or company. 

Community Property States

Did you know that nine US states have community property laws? This means that spouses share financial affairs. So, when you get married, you become liable for any new debt, such as student loans, in the marriage, regardless of who really makes the charges. In these states, everything that’s acquired during the marriage is often considered equally owned by both partners. 

This means that your wife could get a credit card in her name and claim responsibility for it. She can use the card exclusively for her purposes. However, her creditors could still pursue you for repayment. For example, if your wife secretly spent $3500 on jewelry and put it on a Visa card, you’ll be stuck with half the bill. This will apply even if your name was not on the credit card account. This is why it is best to find out how to settle credit card debt and get it off your mind.

Arizona, Washington, Idaho, California, Louisiana, Nevada, New Mexico, Texas, and Wisconsin follow community property laws.

Common Law States

Credit Card Account that is in Your Name Only

In many common law states, you do not need to worry about repaying your spouse’s debt unless you’ve a joint account. There are 41 common law states that assign the responsibility for debt, including credit card debt, to the individual whose name is on the account. 

This means that if your wife or husband has her or his own card and makes their own charges after the wedding, there is no need to worry about being held liable for repayment.

So, if a credit card is only in your partner’s name, you will typically not be liable for that debt. However, if you’ve jointly owned assets, such as a house, the credit card provider can still go after your spouse’s financial interest in the property.

Credit Card Accounts that are in the Names of Both Spouses

If the credit card debt is for a joint card in both your names, note that you and your partner are equally responsible for it.

What about Credit Card Cosigners?

And if you are a cosigner on your partner’s credit card, even if it is not a joint account, you will still be on the hook for payment.

Necessaries

It is worth noting that some states hold a spouse financially liable for the other’s credit card debt if the debt was incurred for some necessary items. And this includes food, medical care, and other such items. 

Remember that the creditor can pursue the other partner if the liable spouse doesn’t have adequate funds in order to pay off the debt. 

Also, this rule might still apply even if two parties are separated and have been living apart for some time. Other states don’t impose liability if the product or item was bought while the couple was separated. 

Authorized User

Are you the authorized user of your spouse’s credit card? If so, you cannot be held responsible for repayment on this account in any common law state. Similarly, in a community property state, you can’t be made to pay just by virtue of being the authorized user. 

Divorce

You should know that in a divorce proceeding, the individual responsible or liable for the original debt is usually assigned liability for it. However, note that a judge might rule that you’re at least partially liable for your spouse’s debt. This is particularly true if the case is made that the credit card debt was incurred for household necessities. 

So, even if one partner wasn’t originally liable for the debt, they might be liable if the family court judge formally assigns the debt obligation to them. However, it is worth noting that being assigned specific debt doesn’t change the contractual terms and conditions between the spouses and the credit card provider. This is because the family court doesn’t have legal jurisdiction over this contract. 

Therefore, a family court judge can’t change the terms and conditions of the contract. However, if you don’t pay the debt and the credit card issuer comes after your ex, your ex-spouse may sue you for breaching the divorce decree and even seek financial reimbursement for any inconvenience or damages suffered.

Final Thoughts 

When it comes to credit card debt and spousal responsibilities, these rules above apply. However, an exception to these rules is if the spouses mutually agree that a specific debt that would have been the responsibility of just one spouse can be transferred to the other. So, you are usually not responsible for your partner’s credit card debt unless it’s a joint account or you’re a co-signor for the card. 

However, remember that state laws vary, and the death of your spouse or a divorce could impact your liability for this debt. 

About the Author: Lyle Solomon has considerable litigation experience as well as substantial hands-on knowledge and expertise in legal analysis and writing. Since 2003, he has been a member of the State Bar of California. In 1998, he graduated from the University of the Pacific’s McGeorge School of Law in Sacramento, California, and now serves as a principal attorney for the Oak View Law Group in California. He has contributed to publications such as Entrepreneur, All Business, US Chamber, Finance Magnates, Next Avenue, and many more.