Transferring from his to mine

Avatar for mymartes
iVillage Member
Registered: 03-26-2003
Transferring from his to mine
21
Fri, 06-10-2005 - 2:48pm

I need some adive........I just got an offer in the mail, on one of my credit cards. It's 2.99% for the life of the balance. My husband has a credit card with interest at 22% it has a balance of at least $4000.00 I am so tempted to transfer his balance onto my credit card. However, I am a little hesistant at the same time.

As alot of you know, our credit card debt is from his past affair at least three years ago. It was $40K and now it's at $19K.

Should I just transfer the money to my c/c at 2.99% for life of balance or keep it on his c/c which is at 22%?

Thanks in advance.

MYM

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iVillage Member
Registered: 09-20-2004
Fri, 06-10-2005 - 3:21pm
Wow, that's a tough one. When dh and I got married, I took on a lot of his debts, took out loans in my name alone to repay some of his debts, but didn'[t bat an eyelash. Your situation is so different, because of the emotional turmoil surrounding the debt. I don't have an answer for you really. My first instinct would be to do it so long as your relationship is solid now, and so long as you won't hold it against mhim. I don't think it really matters that much in terms of who is liable for the debt..so long as you guys are married, you don't really have the luxury of seperateness in the arena of finances, no matter how it looks on paper. i say go with your first instinct and don't second guess it. If the nature of the debt makes you uneasy, so be it. Keep it on his card. i think this is more of an emotional issue than a money one, and whatever you decide is OK so long as you are at peace with your decision. Don't compromise your peace for a couple hundred bucks though, because it is not worth it and will only backfire in terms of emotional strain in the long run..something you can't put a $$$ on. Good luck with whatever you decide. i feel for you. Heather
Avatar for cl_phocid
iVillage Member
Registered: 03-26-2003
Fri, 06-10-2005 - 3:56pm

I understand your hesitation, but aren't you really punishing the whole family if you continue to pay the 22% interest?

All my best,
Danni

iVillage Member
Registered: 08-16-2004
Fri, 06-10-2005 - 4:40pm
But it all depends on you and your hubby. I did this last year with my hubby because they yanked up his interest to 22% Then he proceeded to run the card back up and I had my payment for paying his card off, and his payment again. I think I'd only do this if at the same time, he cut up the card and closed the account. Of course, we are an extreme example of debt gone bad, but that's my two cents.


Edited 6/10/2005 4:40 pm ET ET by spyweb
iVillage Member
Registered: 02-19-2004
Sat, 06-11-2005 - 2:57pm

In one sense it doesn't matter who's name is on the card, if you are married the debt is marital debt. But there is a chance that if he racked it up while you were separated, or for an affair, you could claim that debt should be his if you ever did separate again (and if that happened, you'd want the debt to be on his own card). If you didn't stay together (down the road, and you had previously transfered the debt onto your card), the bigger problem would be that even if he was ordered to pay the card off, he could not pay it and you would be the one holding the bag credit wise, you'd be stuck paying out of your pocket for it, and it would affect your credit not his. So my answer depends on how solid the relationship is now and how long you anticipate it will take to pay it off. How much do you pay to the card each month now? How long will it take to pay it off at 22% vs. 3%? If you've paid $21k in 3 years at 22% interest, that is great. Would you be able to pay the rest of in 3 years even leaving it where it is? Is there any opportunity to get the current card to lower the rate? Have you tried calling them and saying you have a card you could transfer it to at 3%, can they offer you something better than you have now?

Edited to clarify, see the paretheses above.




Edited 6/11/2005 6:02 pm ET ET by firstamendment

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Avatar for cl_phocid
iVillage Member
Registered: 03-26-2003
Sat, 06-11-2005 - 5:03pm

Hey firstamendment - I'm not sure your post is entirely correct.

All my best,
Danni

iVillage Member
Registered: 02-19-2004
Sat, 06-11-2005 - 5:58pm

There is nothing the credit card company can do if it's in his name, that is correct. And it's a good argument for keeping the debt on his own card. But the divorce court could rule differently. In most states debt incurred during the marriage is marital debt and the parties would be jointly liable. She *could* be ordered to pay a portion of his debts (just like he could be ordered to pay a portion of hers). The credit card company wouldn't care about the order, but if she failed to pay he could file contempt in family court. Another way to look at it is this, she could transfer the debt to her card. She becomes solely liable for the debt in the eyes of the creditor. But if it's marital debt under the law, he could be ordered to pay a portion of it, or if it's legally his debt under the law (marital law) he could be ordered to pay all of it. He'd have to pay her card, but if he didn't she'd have to pay it, she'd have the mark on her credit report, but she could still go back to family court and force him to pay her back. Not a good situation to be in. The confusion is that there are two different laws at work. One is contract law, whoever has the agreement with the credit card company, the other is family law, whoever owes the debt based on the distribution of assets and debts a divorce.

Also, if the debt remains on his card the credit card company cannot make her liable if she is just an authorized user. Joint card holders are jointly liable to the credit card company. Authorized users can use the account, but have no liability to repay the debts.

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Avatar for mymartes
iVillage Member
Registered: 03-26-2003
Sat, 06-11-2005 - 6:02pm

Danni,
You are right. The credit card is in his name only. I am not an authorized user nor a co-signer. However, the one I'm thinking of transferring it to is in my name only.

Thank you to everyone who replied. I still haven't decided what to do. Your inputs are greatly appreciated. I love this board so much.

MYM

iVillage Member
Registered: 02-19-2004
Sat, 06-11-2005 - 6:08pm

I edited post #5 a little, I re-read it and I may not have been clear when I was describing the benefits of leaving it on his card, or the risks of transfering it to hers.

Still, it might not be 'all his debt' or 'all her debt' if they did divorce, regardless of who's name is on the card. One thing that can happen is say the debt under the divorce law is considered 'all his' say if maybe there is a law that they were separated when the debt was accumulated or he created it by having an affair, it wouldn't be considered marital debt. Then say they own a home with a lot of equity and he's entitled to half. If the debt was all on her card, but the divorce court said he was ordered to pay it off, she might be able to use his portion of the equity to pay the card off and only distribute the excess to him. So if he was going to get $30k from the equity (his half) and owed $19k on her credit card, he'd get $11k and she'd be fine credit-wise. There are so many things that can happen when you divorce, and given all that, if there is any thought in the OP's mind that it could come to that, she's better off leaving the debt on his card.

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Avatar for mymartes
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Registered: 03-26-2003
Sat, 06-11-2005 - 6:20pm

Thank you, firstamendment.

We don't plan to divorce nor get separated. I haven't forgotten the affair nor do I completely trust him.

I am a SAHM. I have been focusing on paying off my debt first (student loan). However, you never know what happens in life. Marriage is not a guarantee that you won't divorce.

I still have time before the bill is due. I just don't want to be paying credit card debt forwever. We are building our first home. We need furniture, etc.

Thanks again. You guys are great.

MYM

iVillage Member
Registered: 02-19-2004
Sat, 06-11-2005 - 6:25pm
Of course there are never any guarantees, but if you both want to make it work then it can work. If you had a crystal ball and you could see it would all work out like you plan, then transfering the debt to your card makes sense, because it will save you both money. Even if you transfer it to your card and the worst did happen, he would still be liabile for at least some of it as marital debt (and even if you didn't move the debt to your card, you could both be ordered to pay a portion of it in a divorce). So I say go with your gut.

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