How Will Divorce Impact Your Credit?
Divorce impacts nearly every aspect of your life, from the inside out. It only makes sense that you would worry that your credit is going to be somewhat affected by your marriage dissolution too. After all, your credit could prevent you from moving forward with your life. The more you understand the situation surrounding your credit, the better the decisions you can make.
Finding Responsibility for Debt
One of the biggest components of divorce proceedings may be dividing debt between the two spouses. Ultimately, you are responsible for any type of debt that has your name on it, even if your ex-spouse agrees to pay it. Your name can still be attached to the debt if it was deemed community property. Keep in mind that lenders may not abide by a court's ruling, and they may still seek you out if your ex-spouse is not paying their fair share. As a result, your credit could suffer.
Get Rid of Shared Accounts
If you had joint accounts with your ex-spouse before the end of the marriage, make sure you remove your name or get rid of the account altogether. If your name is still attached to the account after your divorce, you may be responsible for expenses it involves.
Don't only think of bank accounts either. Make sure you remove your name from leases, auto loans, and other forms of marital debt for things you no longer want to own. You can discuss who receives which of these properties in court before you remove your name.
Sell Assets Together
If you can agree with your ex-spouse about selling some of your assets, you may be able to avoid some of the issues linked to your credit. You should discuss your options for selling cars, homes, and anything else that you might still have payments on.
Adjust Your Lifestyle
One of the biggest contributing factors to issues with credit after divorce is the sudden lifestyle change. Many people have a hard time adjusting to the new lifestyle, especially if it involves moving and getting rid of assets. If you can downsize to something that fits your new budget better, you will have an easier time paying your bills and avoiding credit issues.
Working with a divorce lawyer is the best way to prevent your credit from taking such a hard hit. Call your divorce attorney today to learn more about the options for working toward rebuilding your credit while you are also struggling with ending your marriage.