Any divorce has to include planning before the legal steps are taken, during the legal process, and even afterwards. You cannot just trust the legal system to completely dissolve a marriage, and you certainly cannot rely on your divorce attorney to protect your financial life. In one respect, the attorney serves only one purpose: knowing which papers to file with the court and walking you through the legal process of getting a signed “final” divorce decree. That attorney has no incentive to also counsel you on the related affairs of the wallet. In fact, I could even make the argument that the attorney’s best interest includes keeping you in the dark. If and when troubles arise later, you are likely to hire the same attorney (for additional fees, of course) to help sort out the mess.

All three of these types have one thing in common: They spur the economy quite directly through their acting out during the divorce process. Because half of all first marriages end, it means someone is going to be moving out. In addition to the cost of moving, this means that one home or apartment is replaced with two; one set of furniture is augmented with new purchases; and one family car becomes one family car each. It’s not just the attorneys’ fees that are financially destructive during a divorce, but the costs of moving, starting over, and simply having to spend money. The new expenses you cannot avoid may be the least of your problems if your divorce is coupled with an expensive makeover, mid-life crises, or the exercise of newfound freedom.

But isn’t the financial question supposed to be taken care of by your attorney? Doesn’t the divorce attorney give you advice about how much you can spend? Of course not. Even the basics like who gets what and who is on the hook for which debts should be part of the process, but often they are not. Shouldn’t your attorney have diligently taken care of the financial angles as part of your divorce? Logically, perhaps. But legally, the attorney is under no obligation to protect you from the financial pitfalls.

Just because a divorce is “finalized” does not mean it’s over. Many times, it’s far from over, and your credit can be destroyed in the ongoing battles. The key is preparation, foresight, and good counsel. Amicable or not, divorce is nasty business, and you must be prepared for anything. Later on in this chapter, I present you with a checklist of 15 things you must do before filing that divorce petition. Joint debts incurred during your marriage are truly the ties that bind, and a divorce decree does not release you from liability. That stack of paper will not protect your credit from damage and plummeting credit scores.

As a starting point in the divorce process, how do you pick the “right” attorney? This is not as easy as it sounds. Divorce is a stressful, painful, and tragic condition, and both husband and wife go through periods of grief and anger during their divorce. Most people want to get away from this negative environment as soon as possible. In some cases, it’s almost as bad as grieving the death of a loved one if, for no other reason, the topic of your grief—a failed marriage—is alive and well in the other spouse while the process goes on.

So how do you find an attorney who knows the law and who respects you for what you are going through? The best candidate is someone who also knows how financial law works. A lawyer who will handle divorce is most valuable if he or she also takes on cases involving real estate, probate, estate planning, bankruptcy, and similar matters. This attorney is going to be more of a Renaissance man (or woman) respecting the intricacies of property settlement, child support, real estate, and retirement accounts—in other words, the financial aspects of divorce.

Where do you find this versatile and experienced attorney? Forget about referrals from your divorced friends. They are more likely to refer you to their ex’s lawyer than to their own. Most people who have been through a divorce using the exploitive “family law” practitioner think they got a raw deal, not realizing that their ex probably had the same kind of experience. You should retain a lawyer based on recommendation, but that should come from professionals you already use: your banker, real estate broker, accountant, financial planner, or the attorney you use for other matters. In asking for a referral, be sure you clarify that you need someone with financial sophistication, and not just someone who knows how to file the paperwork. If that was all that was involved with divorce, everyone could do their own without hiring a lawyer.

An easy test to apply in deciding whether or not to hire an attorney is to ask about how to protect yourself against future financial problems. If the attorney has no idea what you’re talking about or brushes off your concerns, what does that mean? For example, he or she says: “Divorced is divorced. Once I file the paperwork, it’s over.” This means the person is not qualified to provide you with a long-term financial defensive plan to get through your divorce legally and financially. Even your uncontested, do-it-yourself fast and easy divorce is not going to include provisions for avoiding the nightmare that many divorced people go through later.

I am cautioning you that a final decree of divorce does not mean your marriage is over and done with. You have to rely on careful preparation before filing for divorce, negotiation with your spouse on matters like child support or alimony, if applicable, and the property settlement. None of these are easy, and even the best attorney can only do so much.

After your divorce is finalized, even if your ex keeps up payments but is late a few times, that can be devastating. One of the first questions a future mortgage lender is going to want answered is, Have you ever been late on a house payment? You might not be, but if your ex is late and your name is still on the paperwork, that goes against you. In the credit world, your ex making a late payment means that you have also been late on a mortgage payment. You might be able to explain your way out of it, assuming you get the chance. It’s more likely that your application will be rejected without a specific explanation. Have you ever seen the blanket statement lenders give you as a reason for rejecting your loan?

This blanket statement may include any number of issues, including your own late payments or an ex’s problems on debts held jointly during your marriage. It can include mortgages, credit cards, and revolving credit accounts.

Even if you are diligent in negotiating a property settlement, that should include assignment of existing debts. With so much emphasis on “who gets what,” it is easy to overlook the other side of the issue: “who owes what?” What if your divorce attorney friend overlooks a significant debt and it doesn’t get assigned in the paperwork? Just a few months ago, I was having lunch with an attorney friend, and our conversation turned to business. I casually mentioned that our businesses were very closely tied. “How so?” he asked, intrigued by my statement. I went on to tell him how many clients come in to my office every year whose credit reports are destroyed as a result of a divorce. It’s not the divorce itself that devastates the client’s credit; it’s more specifically what the attorney failed to do for the client. Couples establish “joint” credit accounts over their years of marriage. At the time a divorce is imminent, and the attorney is contacted, the credit obligations may be discussed, but don’t get into the detail necessary to protect the client. I explained to him that, when the judge awards a joint account to one of the parties, it does not release the other party of liability. Husband thinks the account was awarded to wife, and he is consumed by a false sense of security—he thinks that he’s no longer responsible. The reality is this—if she doesn’t pay the debt, it still reports on his credit, he’s still responsible, and the debt can haunt him forever. The attorney admitted that he had never thought of that, and was unaware that this was happening. After our discussion, he committed to change his procedure to require a joint credit report to be reviewed at the first meeting. He would go through line by line, and advise his clients to pay off and close all joint accounts immediately to protect their future credit rating. He also would be sure to outline the debts awarded in the decree, using the credit report as a guide to ensure no debts were inadvertently missed.

Making matters worse, what if neither you nor your spouse takes responsibility for the debt, but simply assumes it is the other one’s problem? First of all, you probably don’t have recourse against the attorney even if he or she was clearly negligent. Second, in this situation, the law creates a huge pit for you to fall into. It is no longer a matter of “joint responsibility” for a debt, but becomes “either one’s responsibility.” This means the holder of the debt—the lender—can and will demand payment from either of you, and is most likely to look for the deepest pockets. Meanwhile, even if you are not morally obligated to the debt, your credit is going to suffer. A default or late payment is a huge negative on your credit report; and in this situation, you have no legitimate argument for removing the stain from your credit. It is your legal obligation.

A diligent attorney should (and a few do) run credit checks on both spouses, determine all of the debts involved, and insist that all be negotiated and assigned. The attorney should also insist—as part of the property settlement—that the person to whom a debt is assigned renegotiate the debt with the lender. Few lenders are going to simply take your name off a debt obligation just because you get divorced. You are going to need to insist on refinancing the debt on a home assigned to your ex, even if that means having to refinance the home for cash-out and consolidation. You will need to insist because, by law, a judge can require a refinance in the decree but can’t enforce it. You also are going to need to make sure all jointly held credit cards are canceled and replaced. In some cases, if a credit card is issued in your name only and you just asked for a second card in your ex’s name, the company might remove that name. But if you are joint card holders, you are going to have to cancel the card, negotiate responsibility for repayment, and take steps to ensure that your ex abides by the agreement. Even if a joint account is canceled, the debt still has to be repaid; and if your ex agrees to pay off the balances and then fails to do so (or is late on making payments) that still goes against your credit.

So, how do you avoid these problems? First of all, you need to recognize that divorce is not simply a matter of static process within the legal system. It involves potentially ongoing financial obligations on both sides in a perverse system where you can be held responsible for your ex’s irresponsible habits. Given the kinds of things vindictive exes have been known to do, it is conceivable that a spouse may even intentionally destroy your credit by making late payments. That may be suicidal for the ex’s credit, but for some exes, vengeance is illogical.

Identity theft is a major problem in our society. It’s true that identity thieves can obtain enough information to open accounts in complete strangers’ names, steal their credit and their money, and leave a path of destruction a mile wide for innocent people to try and clean up. If strangers can do it, imagine how easy it is for someone who knows everything about you. Divorce brings out the worst in people, and when there are feelings of betrayal and anger, ruthless vindication can ensue. Lisa was a woman scorned. She felt that her husband had betrayed her, and that the best revenge would be via his pocketbook. She opened three new credit cards in his name, and proceeded to shop with reckless abandon. Matt didn’t know about the new cards until he applied to refinance the house into his name after the divorce was finalized. Imagine his surprise when he had over $30,000 in brand-new credit card debt, and of course, late payments on all three accounts because she had no intention of paying the debts. Matt had three options, the first of which would be to file a police report against her; however, this isn’t an easy choice. Matt and Lisa have three children, and Lisa had custody of the kids. Sending her to jail was not an option. Option 2 would be to simply pay and close the debts, but the divorce had left him broke already. Option 3 was to get the debts caught up and pay the monthly minimums to try and salvage his credit. Of course, he should put a fraud alert on his credit report and pay for a monitoring company to protect himself in the future. Lastly, if none of these three options were possible, he could end up in bankruptcy as a last resort.

You need to understand that an angry divorce is likely to be characterized by an ex using whatever weapons are available. Among the most tragic is the corruption of a child’s affections as a form of vengeance for a divorce. This usually occurs when the custodial parent poisons a child’s mind to believe that the other spouse is evil. “He left because he doesn’t love you anymore” is not untypical of the kinds of statements made to destroy the relationship between a parent and a child. It is not only tragic; it is a form of extreme child abuse, but it is common. An expert named Dr. Richard Gardner coined the term parental alienation syndrome. He explained that a child never recovers, even after realizing what was done to him or her. It becomes a lifelong scar of guilt.

Parental alienation syndrome is a tragic and cruel matter. But perhaps equally devastating is what I call financial alienation syndrome, the ongoing problems created when property is appropriated between spouses but the obligation remains undefined or continues to be held jointly. This problem is one of many reasons that you need to work with an attorney who is financially aware and sophisticated enough to protect you against this financial alienation. The symptoms of the syndrome include three parts:

In addition to using the most qualified attorney with both family law and financial experience, you also need to take 15 specific steps before you file for divorce. These steps are critical if you want to avoid losing control over your credit and the security of your financial health.

A divorce, even in the best of circumstances, is going to be painful and difficult. You can help to ease a lot of the pain by remembering that a “final” divorce is not the same as a final financial divorce. You need to make absolutely certain that you have severed all of your financial ties to your ex to avoid nasty surprises in the future. For this reason alone, you cannot settle for an attorney who practices only in family law. You need an experienced attorney who also knows all about financial issues, including real estate, tax law, retirement planning, and financial planning. If you are going through a divorce, start by memorizing the 15 steps above, and using these as your guide for protecting your interests now and in the future.