Jones says people can get divorced in Pennsylvania without ever separating their assets and debt. Unfortunately, many people are interested only in receiving the divorce decree, and they worry about finances later.
Splitting finances needs to be a top priority. Financial planner David Martin says financial institutions are not in the business of mediating divorce disputes.
"You have an obligation," Martin says. "They don't care about personal circumstances. They have to be paid off. If the divorce is over and those debts haven't been paid, no one is going to get another loan. Well, they'll get a loan, but it won't be on attractive circumstances."
If you own a home jointly, whoever is going to keep it must refinance. The other spouse's name must be removed from the mortgage and deed.
"There are many programs that allow for people coming out of divorces in adverse circumstances," Martin says. "Different government agencies allow for special mortgages."
Credit cards need to be paid off. Joint accounts must be closed, and each person should establish his or her own credit.
If you shared bank accounts, lines of credit or loans, one person can seek revenge on the other very easily.
"Nothing should be allowed to be moved without two signatures or verification from both parties," Martin says.
Then, there's the vehicle. It's usually the biggest nightmare because of car loans and shared title.
"The car either has to be sold or someone has to agree to pay for it or share in payments as part of any agreement," Martin says.
If your name or your spouse's name is not removed from any assets held jointly, you are both liable for any debt. In addition, if you plan to sell that asset later, you will need the other spouse's permission.
