Divorce: Safeguarding Your Credit
If you are facing divorce, your number one concern (after child custody arrangements) is likely to be your finances, and this includes your credit. Because most people’s finances are negatively affected by divorce, your credit is also likely to take a hit. There are, however, things you can do to help safeguard your credit. If you are going through a divorce, consult with an experienced Central Texas divorce attorney today.
Divorce and Your Credit
It is important to understand that your divorce itself will not affect your credit score. Divorce is not a credit event – such as a missed payment or bankruptcy, for instance – that will show up anywhere on your credit score. It is the financial repercussions of divorce that can wreak havoc with your credit and credit score. Staying on top of your finances throughout the divorce process can help you ward off dings to your credit. If your divorcing spouse is not cooperating, however, staying on top of your finances may be easier said than done.
Your Joint Accounts
Most couples, in the course of their marriages, have joint credit card accounts and loans in both their names. This is all well and good when you are married, but if the marriage ends in divorce, it is not unusual for such accounts to slip through the cracks and to cause credit problems. The fact is that divorce is often overwhelming, and attending to all the financial details is not always a straightforward task.
Organizing Your Finances
The best way to avoid credit difficulties during the divorce process is to pay close attention to that credit that is in your name alone and to your joint credit. While the divorce will ultimately sort out which marital assets and debts belong to whom, you do not want to lose sight of these accounts in the meantime. Creating a chart of those accounts that are in your own name and those that are in both of your names and keeping track of all payments as they are made – whether by your or by your spouse – will give you the peace of mind that comes from knowing you are being proactive when it comes to your post-divorce credit. Online payment systems make it much easier to be sure that the necessary payments are being made.
Finalizing your divorce will establish which of you is responsible for which credit accounts, but this does not mean that your credit is ultimately protected from your ex’s actions. Your first order of business after finalizing your divorce should be to remove your name from any accounts that you are no longer connected to and to remove your ex’s from any for which you are ultimately responsible.