Divorce and Your Credit Score
Divorce inevitably takes a financial toll, and it is important to pay attention to the ramifications divorce can have on your credit score. There are, however, things that you can do to proactively address this issue. When you move forward into your post-divorce life, you should not be burdened by a lackluster credit score that could have been avoided. Making the right decisions now can help ensure that you avoid this issue entirely.
The Divorce Itself Is Not the Problem
It is important to understand that the fact of your divorce will not affect your credit score one way or the other because it will not be reported to the major credit bureaus. If your divorce leads to any of the following, however, it is a different matter:
A charge-off (when a bank or creditor declares that a debt is not likely to ever be successfully collected)
Any of these and other financial issues can affect your credit score, and any one of them can be brought on by divorce. The goal is to avoid these issues from the outset by focusing on your overall financials throughout the divorce process and beyond.
Do Not Overlook Financials
Divorce is a hectic transition in which you and your divorcing spouse will be hammering out major financial issues in an attempt to ensure a just and right distribution of your marital property (the assets and debts you acquired together as a married couple). While the big-ticket items naturally get their fair share of attention, lesser financial concerns can take a backseat – but can still negatively affect your credit score if left unattended. Once the damage is done to your score, it takes considerable effort and time to make it right. An ounce of prevention in this situation is worth at least a pound of cure.
Joint accounts, such as credit card accounts, are often the issue. Anything that is in both of your names remains in both of your names after the divorce. To disentangle your name from any such accounts, you must go through the necessary protocols. Not to do so leaves you on the hook for any potentially credit-harming issues that may arise. The terms of your divorce decree are unlikely to sway a creditor who is coming after delinquent funds.
If, in your divorce, your ex takes over 15,000 in credit card debt that is on a joint card, it goes on your list of financial benefits. If you fail to remove your name from the card and your ex fails to live up to his or her financial obligations regarding the card, you will both take a hit on your credit score – despite the fact that your divorce relieved you of this financial burden.
You Need an Experienced Killeen Divorce Lawyer on Your Side
Your post-divorce credit score is important to your future, and attorney Brett Pritchard at The Law Office of Brett H. Pritchard in Killeen, Texas, is committed to helping you maintain a healthy credit score while pursuing a division of marital property that supports your rights. We are here to help, so please do not hesitate to contact or call us at 254-501-4040 for more information today.