Protect Your Credit During a Divorce
Divorce can be a serious drain on your finances and credit. If you’re planning on getting a divorce in the near future, keep the following sources of financial strain and credit trouble in mind, and do what you can to diminish their impact on your credit. A consumer debt and bankruptcy attorney can help you handle the impact a divorce has had on your credit after the fact.
- Make sure your ex is paying any joint bills: After going through a divorce, many people have been dismayed to discover that debts or credit accounts that were allocated to their exes in a divorce, but which still bear their name, have gone unpaid since the split. Some people have even discovered the hard way that their ex stopped paying the mortgage on a house where they were still listed on the deed. Late-paid bills can have a substantial negative impact on your credit score. You may want to call the financial institution where the account is located and ask them to send you a statement each month. That way, even if your former spouse stops paying, you’ll discover the lapse before even more damage is done.
- Don’t take on more obligations than you can afford in a divorce settlement: When you’re dividing your assets in the course of a divorce, you may feel tempted to keep large items to which you’re personally attached, such as a house with a large mortgage payment due each month, or a car that comes with a hefty loan payment. Perhaps while you were married, these expenses were affordable, but within your new single-income budget, they might become unaffordable. Don’t fight to keep assets you can’t afford, and consider trading in these larger assets for a more affordable version.
- Ensure that only the right names are listed on shared accounts: You might not immediately remember all the different lines of credit and other financial accounts you’ve opened over the years with your ex. Do a thorough inventory of your records so that you feel confident you remember what exists with both your and your spouse’s name on it, and try to close out or consolidate what no longer needs to be open. Having accounts with both your and your ex’s name leaves your ex the opportunity to accrue more debt partially under your name, and that could mar your credit. Where possible, take your ex’s name off any formerly-shared accounts that are now only in your name, and likewise remove your name from any accounts that are now solely your ex’s responsibility.
- Closely monitor your credit after a divorce: Sadly, many instances of identity theft are committed by those related in some way to the victim, and it might not take much prompting for a scorned former spouse who is short on cash to use your name and personal information, or even an existing account listed as yours, to rack up debts. Consider subscribing to a credit monitoring service during the early months after a split.
For assistance in Kentucky with mounting debt or in deciding whether bankruptcy might be the right solution for you, contact the compassionate and experienced Bowling Green family law and bankruptcy attorney Lanna Kilgore at 270-846-3700.