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CAN SHE STOP WORKING AND STICK ME WITH THE DEBT?

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If you're like most guys (and many ladies) going through divorce, at some point during the process you have probably heard the following threat, whether from your wife, or her family, or, sometimes, out of concern or otherwise, even yours: I'll just quit my job, and then you can pay for everything. But can she? The short answer is, yes - that is, unless there is an order requiring her to seek and maintain gainful employment (more on that below). However, the consequences to you, if litigated correctly, could be nothing, as if she were still working.

Take, for example, these three key components of the divorce process:

Income Imputation - In all states, a spouse cannot become voluntarily unemployed or underemployed, then turn to the other spouse for more child support and/or alimony. Instead, your judge will calculate your support obligations, if any, as if she were earning her prior, or reasonable, income. This determination is called income imputation. She may still chose not to work, unless the judge also requires her to seek and maintain gainful employment, but the judge will ignore her loss of income when fashioning how much you should pay. Beware, however, because this income imputation determination is fact-intensive - that means, you will have to come to the judge prepared to show jobs are available, that your spouse can work them, that she previously did work them or has the skill to do so, that she has no physical or mental issues that prevent her from working and what the prevailing pay rate is in the area. Job postings are critical here, as may be a vocational evaluation (with an expert who determines what work she can do) if she takes the "I'll just quit" stance to its extreme. But, if your support obligations would otherwise double, these litigation expenses are probably worth it.

Refinancing - The judge's decision to impute income, however, matters not one bit to a creditor deciding whether to extend your spouse some credit. For example, if she does not have a job and lacks other sources of regular income (such as a pension payout), it is highly unlikely a creditor will allow her to refinance a debt from your name to hers alone. Instead, the creditor will expect to see a recent history of paychecks, a relatively stable job and sufficient funds in savings, as well as the ability to pay debts as they come due. Your spouse will have n ability to do so, despite what the judge says about her ability to work, without an actual job. This is one circumstance in which an order to seek and maintain employment would be helpful - and, more importantly, for you to reconsider giving her the debt or, at least, insist that she provide proof of credit qualification and a willing co-signor.

Self-Help Remedies - If you will be waiting for your newly ex-spouse to obtain employment or refinance debt out of your name, you should include in your settlement agreement (or ask your judge to award you) self-help remedies. This way, if she continues to be unemployed or underemployed and cannot pay take on the debt, you can take action to remedy the situation without having to hire a lawyer, file a petition, attend a hearing, and possibly more than one, and then enforce your judge's order. Instead, you may be able to repossess a vehicle and assume payments for it (if she was to pay the debt), or force a sale of real estate (if it remains unpaid or not refinanced), or redirect your child support or alimony payment to a debt she was supposed to pay that month but did not, and so forth, without first going to court. These are self-help remedies, that, when used appropriately, within the confines of your court order, can save you significant time and money.

Although we would like to think spouses would not sandbag each other into financial ruin, by quitting a job or failing to refinance or skipping a bill, it happens. If it happens to you, keep these in mind, and you could find yourself in the same, or a better, position regardless of what your soon-to-be-ex threatens.

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