Divorce can affect a number of different areas of your life, including your finances. Although many people know that ending their marriage will impact their finances, they often don’t realize the effect that divorce will have on their credit score. How can divorce affect your credit score? Here’s what you should know:
It’s common for married couples to open joint credit card accounts during the course of their marriage. During the divorce proceedings, the judge may order one spouse to make payments on these cards. If your spouse is ordered to make payments and fails to do so, the missed payments will affect your credit score since the card is in both of your names. It doesn’t matter that the judge did not order you to make the payment–the missed payment will still lower your credit score.
The same thing can happen with couples that have a mortgage in both of their names. If the spouse that is required to make the payments does not do so, this could affect your credit score.
Difficulty Paying Bills
If you spend a lot of money on the divorce, it may be harder to cover your monthly expenses on your own. As a result, many people in this situation cannot afford to make payments on their monthly debts. Missing a payment or making late payments on credit cards, mortgages, or any other debts will affect your credit.
People who are running low on cash after a divorce also tend to charge more to their credit cards. Increasing the balance significantly can cause your credit score to tumble, regardless of whether or not payments are made on time.
An angry ex-spouse may try to seek revenge by charging hundreds or thousands of dollars to your joint credit cards. Not only will this increase the total balance on your credit cards, which affects your credit score, but it will also raise the monthly minimum payment. The minimum payment may be unaffordable as a result of your ex-spouse’s frivolous spending, so your credit score could drop due to your inability to make the required payments.
Protecting Your Credit After Divorce
It’s important to closely monitor every joint account after a divorce so you can catch issues that could affect your credit. You should also frequently run a credit report to ensure you’re not missing anything. Taking these steps can help you protect your credit score so you can rebuild after a divorce.
Are you filing for divorce? If so, Williams Law Group, LLC can help. Let us protect your best interests throughout the divorce proceedings. Your financial future is safe with our skilled divorce attorneys by your side. Call our office at (908) 810-1083, email us at email@example.com, or contact us through our confidential online form to schedule a consultation.