Mortgage Wars and Other Fights That Hurt Your Credit

By Jennifer M. Paine

Attorney, Cordell & Cordell

Note: Part 2 discussed protecting your credit score when you divorce and after you divorce. Click here to read Part 2.

Joint debt is a large source of contention in divorce, second only, in my experience, to children. What seemed like a good idea during the marriage —  that mortgage to buy a bigger home or credit card with a secondary cardholder so both of you could buy groceries and pay bills, for example – feels like the biggest mistake ever during divorce.

Inevitably, one spouse insists the other pay, or cannot pay, or simply hoards money elsewhere and refuses to pay. If neither pays, well you know what happens next: a derog on the credit score.

Combine that with a hefty legal bill, a mortgage to refinance, car loans and student loans and personal loans to pay, and your credit score will crash and burn, taking your pocketbook and your sanity along with it.

How can you protect your credit score?

As the first of the month approached, the war between Bill and Sue escalated. Their divorce was not amicable by any means, but usually their animosity was a dull roar over who would take the pictures, the furniture and the boat– until the mortgage came due.  They lived in the same house, Bill in the basement with the dog and Sue everywhere else. Bill could not venture upstairs to Sue’s space, and she could not trudge downstairs to his. But when the mortgage came due, neither wanted to pay for any of it – not their own space, and certainly not the other’s.

So, they stalled. The first day of the month would pass with no payment. Then the second and the third. By the fourth day of the month, Bill would send an e-mail “reminding” Sue to make the payment, and Sue would leave a note on the basement door “reminding” him to do the same, with a sarcastic “DEAR” underlined angrily in black pen. By the sixth day of the month, they unleashed their lawyers. First there were phone calls accusing each other’s client of ill will. Then there were e-mails, letters and faxes. Then the seventh, eighth and ninth days of the month would pass. Still no payment.

On the tenth day of the month, one spouse always caved in: Bill. He would make the payment at lunch, then after work mutter past Sue in the kitchen on his way to the basement grumbling an explicative or two and anticipating the day he would no longer be tied to her.  If he ever wanted to move out of that basement, he had to protect his credit.


Before Your Divorce

Before your divorce begins, gather your records, find out who owes what, and set guidelines for who pays which debts, when and how. This is your first step and the most important you will take, financially, during our divorce. You must have a frank, open discussion with your spouse about your finances. It is easy for the spouse left in the dark to think the other is hiding money, which leads to the inevitable wild accusations, threats from attorneys, subpoenas for bank records, and thousands spent just to prove you really were, in fact, in debt and had no bank account worth millions in Sweden. (If you think this is incredible you either (1) are not divorcing or (2) are one of the lucky few who have not faced these accusations.)

If you maintain a filing cabinet or an e-file for your bills, then start there. Make a copy of each bill (they have a way of “getting lost” or snatched for your spouse’s attorney). Create a spreadsheet that details each creditor, outstanding balance, minimum payment and how to make it, due date, and reason for the debt. Decide which debts you can pay off before you divorce (e.g., a clothing store charge card) and which you can do without (e.g., a monthly gym membership) during your divorce. If you and your spouse are one of the few amicable divorcing couples, use the spreadsheet to negotiate who will assume which debts.

If you are like most people, however, your records are not so immaculate and well-kept. You should order a credit report to determine which debts are in your name, and your spouse should order one, too, for comparison. You may obtain a free credit report each year online at You must supply identifying information, like your Social Security Number, and it will be tempting to order your spouse’s at the same time. Do not. It is a federal crime to order someone else’s credit report without the person’s authorization, even your spouse’s, and you face fines and jail time if you do.  See the Fair Credit Reporting Act, 15 U.S.C. 1681n and 15 USC 1681n.

When you have all of the debts and who pays what listed, consider making your payment plans enforceable. Do not expect your spouse to pay one-half the mortgage or her own car loan willingly. You are getting a divorce for a reason after all. Consider memorializing your payment plan in a writing signed by both spouses and their attorneys and submitted to the judge for entry as a temporary order. An order is a mandatory directive for each spouse to pay particular debts and it carries with it the threat of contempt. If your spouse refuses to pay her share of the debt, for example, you may ask the judge to hold her in contempt with all of the fines and punishment and attorney fees contempt entails to compel her to make the payment and/or to reimburse you if the creditor badgers the payment from you.

However, the same is true for you. Therefore, if your finances are precarious and you will not have the funds to pay your share, you should forgo a temporary order in exchange for (1) a serious consultation with a bankruptcy attorney and/or (2) a prompter property settlement.


Note: Part 2 discussed protecting your credit score when you divorce and after you divorce. Click here to read Part 2.


Jennifer M. Paine is an Associate Attorney in the Detroit, Michigan office of Cordell & Cordell. She is licensed to practice in Michigan, and has been admitted pro hac vice in Illinois, Ohio, and the United States Court of Federal Claims.

Ms. Paine received her BA in English and Mathematics from Albion College and graduated Summa Cum Laude. She received her Juris Doctorate from MSU College of Law and graduated Summa Cum Laude.

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2 comments on “Mortgage Wars and Other Fights That Hurt Your Credit

    Douglas is right…
    Douglas is absolutely correct. Any statements made on the divorce decree about who pays off what do not matter to the creditor [i]at all[/i]. All debts should be separated. Joint accounts need to be closed, and each former spouse should have credit in their own name. Otherwise, their credit score could be hurt by the ex-spouse who failed to pay, even if the divorce decree orders their ex-spouse to pay it.

    If one spouse is absolutely unable to pay, the other needs to take on more debt and receive more assets to offset that debt. Never leave it up to an ex to pay, even if they are ordered by the courts to do so.

    “How to protect your credit score”
    Ms. Paine, the only way one can protect his credit score is to pay the debt or file bankruptcy.
    A judge can assign debt portions for you and your wife to share payments, however, your score will reflect any late, or unpaid amounts. I have the scares to show for it.
    The creditor does not honor the judgement you do. The creditor will report the delenquency!

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