Your Credit Score Could Drop During Divorce
If you are going through a divorce, most likely there are lots of things on your to do list, and lots of details to attend to. One of which is, protect your credit score. According to a 2019 survey conducted by Debt.com with Moneywise.com, 38% of respondents saw their credit score drop by more than 50 points after separating from their partner. If you are going from a 2 income house to a one income, yours, your financial situation could change quite a bit.
The first thing you want to do is to run your credit report. You may not like what you see, but it is not one of those things you want to ignore. Hiding your “head in the sand” and ignoring what is there won ‘t help matters. By running your credit report you will find out what your credit score is. You can run it by going to this website. annualcreditreport.com or call this number to request it. (1-877322-8228)
In addition to getting your score, you can also see all of your accounts. It will list when each account was opened, and if they are still open. It will give your payment history on each account, as well as the balance. By Federal law, you are entitled to receive one free credit report annually. Be careful, there are online sites that will charge you for this service!
Pay Your Bills On Time To Protect Your Credit Score
Once you or your spouse are served with divorce papers, you are each still responsible for your own debt (unless the Court issues a different Order). You should open a new bank account in your name only. Also if you are the primary name on a card you used to share, have your spouse ‘s name removed and let he or she know they are no longer to use that card. If you are secondary on your soon to be ex-spouses card, be sure to get your name off of the card. You might consider closing out any joint accounts and getting a new credit card issued to you. Be sure to discuss this first with your divorce lawyer to be sure he/she recommends this and that doing so won ‘t violate any Restraining Order issued by the Court.
Paying your bills timely is important when it comes to keeping up your credit score. Make sure you review all of your monthly expenses, and figure out how you are going to pay them. Often one spouse took on the role of managing bills, and if you weren ‘t used to doing so, it may take a little adjustment on your part. You certainly don ‘t want late payments to lower your credit score!
Unpaid Divorce Debt
Existing debt that you and your spouse have incurred may be divided between you and your spouse as part of the divorce. Remember that obtaining a Decree of Divorce does not change or absolve a party from a joint contract with a creditor. If a debt goes unpaid a creditor will go after whoever they can to get repaid. An experienced divorce lawyer will talk to you about this. Perhaps as part of the settlement terms you might want to have your spouse refinance any of the joint debts they are assuming responsibility by a given date, or maybe you want to assume a greater part of some of the debt in exchange for more assets.
Now would be a good time to create a budget and do your best to stick to it. Review all of your monthly bills and expenses. Your lifestyle will likely be different after your divorce, and perhaps this would be a good time to evaluate your spending habits. You want to be cautious with your finances to be sure you can cover your expenses, and don’t end up with late payments.
Things may seem overwhelming during a divorce, but you need to take care of yourself, and protecting your credit score is a very important thing you can do for yourself.
We are Experienced, Trusted and Professional Dayton Divorce Lawyers
Do you need help with Ohio divorce or dissolution case? We can assist you immediately. To learn more, please go to our website at www.hcmmlaw.com or call us at 937 293-2141. We can schedule an in-person conference or one by phone or Zoom.
Please consider joining or following us!
© 2022, Ohio Family Law Blog. All rights reserved.
Attorney Robert “Chip” Mues has been focusing his legal practice throughout Southwest Ohio primarily in divorce and family law matters since 1978. Chip is passionate about family law and has proudly published the Ohio Family Law Blog since 2007. In addition, he is the managing partner of Holzfaster, Cecil, McKnight & Mues. To learn more about him or the law firm, visit the firm’s website at www.hcmmlaw.com. Appointments are available in person, over the phone or by Zoom. Call us at 937 293-2141.
