What to do, or not do, to maintain a good credit score in divorce

Divorce opens the door for happiness and a new beginning for many; however, that can often be quickly tainted by poor credit. Pulling apart one, complex financial life, can be damaging for at least one if not both parties to a divorce. Consider some obvious and some lesser known information to help protect your credit score in divorce.

Educate yourself about yourself

First, get informed as to your current standing with all three credit reporting bureaus. If you have already used your free first copy for the year, it is a worthwhile purchase to see into the future by looking at your past. Experian, Transunion and Equifax are the three bureaus whose reports you will want to peruse. Each are slightly different but show an overall picture to a lender. Eventually you will want to buy another house, rent a new apartment or make another big purchase. Being caught off guard by some shared debt is not how you want to start your new beginning.

Visit the official Annual Credit Report website for the free copy you are allowed every twelve months. Or, contact each entity separately and request a free copy of the credit report. Generally, the simplest way is to visit their sites. Get it over with now before any major issues need to be discussed in court. If you are considering divorce, take a look at this information as early on as possible in the process to salvage or maintain your credit score in divorce.

Set aside time to study the reports and list all of the joint accounts. List out checking accounts and credit cards, store cards, car loans and so on. Of course, find out the principal on the mortgage if you managed to forget, and add that to the list. These joint accounts all affect you now and can affect you after the divorce if not handled properly. If you are considering divorce, begin closing paid off accounts, or paying off those with a balance. Often, couples forget the store card they picked up a few years ago to make a smaller purchase – these do not just go away on their own.

Whose problem is whose

If you are not able to pay these off or do not feel it should be your burden, the divorce settlement will dictate whose name may be removed from each account or who pays for what. If thorough research is not done, a poor credit score down the road will likely point to an unpaid joint account. Additionally, assuming that the former spouse is going to take care of it will not bar any negative feedback if your name is still on the account.

Perhaps the judge has indicated that your ex must individually pay off certain joint accounts – that should still hold up with the credit bureaus right? Wrong. Many people assume that the results of domestic relations orders or agreements will stand up against credit bureaus and it is not the case. If both names are still on a delinquent account, both parties’ scores will suffer.

Depending on the nature of the other parties’ delinquency, the results could affect your score for years in some instances. Do not assume that he or she will close the account or take your name off of the account. The detriment will come at a far greater cost in the future than simply researching your credit score in divorce and before.

If you are considering divorce, contact the experienced Bucks County divorce lawyers at the Law Offices of Michael Kuldiner, P.C., at (215) 942-2100. Schedule a consultation with an attorney to discuss your credit score in divorce, or other domestic relations matters. Our knowledgeable and trusted divorce lawyers can get you through the process and ensure your best interests are represented.