A Readers Question - When the Responsible Financial Party Isn’t Acting Responsibly?

September 4, 2009 12:51 am Geo Blog, Credit

 

Lisa,
 
In my divorce judgment my former husband was given the financial responsibility of paying for and selling a time share in which both our names are on the loan.  He is in default of payment and this has affected by credit score.  What if anything can I do to straighten this out with the credit bureaus so that it doesn’t continue to lower my credit score.
 
Sincerely,
 
E.W.
 
 
 
Hi E.W.,
 
Unfortunately, this is an all too common scenario in divorce when splitting liabilities.  I always counsel my clients to pay off any joint debts when possible BEFORE the divorce is finalized to prevent these kinds of problems in the future.
 
In situations where that may not possible, then at least request that the mortgage, auto, credit card or other company you are indebted to, send copies of the statements to you,  as well as to the spouse that is supposed to be responsible for paying off the debt.  This will give you the ability to stay on top of seeing that the payments are being made on time and avert further problems if they are not.
 
First of all, you can take your husband back to court and sue him for breach of contract in not living up to the terms of the divorce settlement agreement.  This will likely entail hiring an attorney so factor in the cost of legal fees and see if you can recover those costs as well.  If he is in a position of not paying due to financial constraints then it may be difficult to collect even if you are successful in court.  Weigh the cost vs. benefit before rushing into court.
 
As to your credit:
 
  1. You can take over and start making the payments to prevent further problems.
 
  1. Contact the mortgage company on the loan and let them know the situation.  Ask them how much he is in arrears and will they consider going back in and correcting the credit history, in essence wiping off the issue on your credit report, if you make up the payments?  Some will, some won’t….doesn’t hurt to try.  Ask to speak to a supervisor if necessary.  These days most will be happy to reclaim the money and be accommodating to your needs as well.  Get any agreements from the mortgage company in writing before you make any payments.   
  2. Have your husband quit claim his interest to you and then try to sell your interest in the time-share on your own.  Time shares are a bit tricky to sell, so you may have to come up with some creative options.
 
  1. If you are not in a position to do these things then I am afraid there is not much more you can do other than let them foreclose on the loan.  Unfortunately, that will have a further negative credit rating on you as you have found.  You could put a note in your credit files stating the terms of the divorce, but as you now likely know, courts do not have authority to make lenders comply with the terms of the divorce decree.
 
I am sorry you have found yourself in this unfortunate situation and hope that this information helps in some way.  Good luck with it.
 
Best regards,
 
~ Lisa ~

 

A special thanks to Cindy Morus, the Money Mender, for some of the information contained above.   Cindy is my next teleseminar guest for September!  More details coming soon…. 

 

Comments are closed.