Divorce doesn’t directly affect your credit score, but it can play a role in damaging your credit. Forgotten accounts, establishing your own finances independent of your ex, and even malicious action by your ex all can have an effect. Learn how to protect your credit during your divorce with these steps.
Create a Budget
Going into debt certainly won’t help your credit score. After the divorce, your expenses and income will have changed. Take stock of what you owe, what you make, and what you spend, and plan a budget that will allow you to pay off any outstanding debt, set aside money to save, and cover your bills. If needed, consult a financial advisor. They can help you figure out the best way to pay off your debt quickly, while still keeping up with your bills and setting aside money for an emergency.
Know Your Lines of Credit and Debt
This can be a bit tricky, but a good first step is to pull a credit report for yourself. This will show your open lines of credit, even ones you may have forgotten about, such as store cards. Note which ones are joint, which ones you are an authorized user on, and which ones are solely yours. A credit report may not catch all lines of credit, so be sure to check other possible sources.
Remove Other Authorized Users
You will need to take control of your lines of credit. Have credit cards reissued in your name only, and remove authorized users from your accounts. Restrict your ex’s access to your finances, including changing usernames, passwords, and security questions if necessary. Be sure to remove yourself from your ex’s accounts as well, so their credit score can’t affect yours.
Tackle Your Joint Accounts
This may be difficult, but try to close all joint accounts with your ex. Transfer balances to individual accounts or pay them off and close the account. Divide the remaining debt responsibility. The spouse that gets the house also will take on the mortgage. The spouse that takes the car will take on the auto loan. Refinance these loans as necessary so that only one spouse is responsible for the loan.
Monitor Your Finances
Check your credit reports, bank statements, and statements for any joint accounts you were unable to close. Routine monitoring can help you catch a problem or identify fraud before it gets out of hand. You can also watch your progress as you establish your own finances, and keep track of your growth.
Maintaining your credit through a divorce can be stressful, and feel like one more impossible task to keep track of, but the consequences of leaving your finances in the hands of your ex are too great. Tackling your financial situation can help you thrive after your divorce, and you will be able to take control of your financial future.
Divorce can be an enormous struggle, but there is help. Our team of Long Island divorce lawyers boasts over 100 years of collective experience handling divorce cases. We will provide you caring, affordable legal representation to see your case through. Contact The Hedayati Law Group P.C. today to schedule a free case consultation.