What happens to debt review after a divorce settlement has been finalised?

Dealing with divorce can always be a tricky time, with debt review however, it completely depends on your own, unique situation.

Your marriage contract in itself will have a huge impact on how the debt review process is handled, once your divorce has been finalised. If you and your spouse are married in community of property, you will be under joint debt review due to the fact that legally speaking your estate is viewed together as one single joint estate. Both you and your spouse are jointly responsible for any outstanding debt.

If you get divorced while you are under debt review and the court order is in place, this will need to be rescinded and you will need to apply for new debt counselling processes for each of you. To follow on with the debt counselling process you will need to reapply, but will now need to be seen as two single applicants. A new budget and new proposals will have to be drawn up for your separate cases.

A debt counsellor will do this by sending a change of circumstances form to all of your credit providers, explaining that you are going through a divorce and that the joint application will now be converted into two single applications, with the relevant debt put onto each person’s debt review profile.

This can take time and will cost you more money due to legal fees, as well as potential debt counselling fees, if changes in budgets and proposals are required.

If you are under debt counselling with National Debt Advisors, it is vital that you notify them about your divorce as soon as possible.