Myth: My Divorce Decree Protects My Credit Score

Fact: Even if your divorce decree stipulates that your ex-spouse is financially responsible for debt that is held in both your names, you remain financially liable for that debt until it is paid in full. Both of you entered into a binding contract with the creditor. To change the terms of that contract requires agreement by and the signatures of all parties—including the creditor. Since creditors are not a party to divorce proceedings, the decree does not officially amend the terms of the initial credit agreement between the former spouses and the creditor. If your ex-spouse is named as the responsible party for a jointly held debt, you should monitor the account closely to make sure it is being paid in a timely manner. Otherwise, negative payment history information will appear on your credit report, likely resulting in a lower credit score.