While getting a divorce won’t directly hurt your credit score, it’s common for people to find themselves in trouble after a divorce because their financial dynamics have drastically changed. However, taking proactive measures will ensure that your credit remains protected as you navigate the complexities of your divorce. Please continue reading to learn how to safeguard your credit score during a divorce and how a skilled Suffolk County Divorce Attorney can assist you during these difficult times.
How Can a Divorce Impact My Credit?
First, it’s important to understand that your credit score is a number that financial institutions use to estimate how likely you are to pay back borrowed money on time. This score can impact various parts of your life, such as your ability to rent a house, get a loan, or even secure a job.
When you decide to dissolve your marriage, understanding what will happen to debt is crucial. New York operates under the equitable distribution rule, which means that debts are divided fairly, but not necessarily equally, based on the circumstances of each spouse. The court will examine several factors including who opened the account and whether one party benefited more from the debt. It’s important to note that one party may be assigned more debt than the other when dividing the remaining balance. This may be the case if one spouse attempts to run up credit cards before the divorce on joint accounts, this may be considered marital waste and they can be held solely responsible for the expenses.
While divorce itself won’t directly impact your credit score, as marital status is not a factor in credit reporting, the financial changes that come with a divorce can affect your score significantly. The division of financial responsibilities during a divorce can lead to missed payments, increased debt levels, and misuse of credit. When one spouse fails to pay a jointly held debt, such as a mortgage or credit card bill, it will negatively impact both parties’ credit scores.
How Can I Shield My Credit Score During My Divorce?
If you are concerned about the impact of your divorce on your credit, it’s important to take proactive steps to minimize any potential issues. You should start by obtaining a copy of your credit report to review your current financial situation. Make a list of all joint financial accounts and discuss with your ex-spouse how you plan to handle them.
From here, you should remove yourself as an authorized user on any credit cards owned by your ex-spouse and remove them from any accounts that they are authorized on. This can help reduce your liability for any purchases your ex-spouse makes, especially if they don’t pay their bills on time. It’s important to regularly monitor your credit reports to ensure no discrepancies or unauthorized activity.
To further protect yourself, you might want to consider placing a freeze on your credit accounts until you have finalized your divorce. This step is significant because it can deter your spouse from attempting to open accounts using your personal information.
If you follow these steps, you can establish a stronger foundation for your financial well-being during this significant transition. At The Law Office of Susan A. Kassel, P.C., we are prepared to help you navigate this complex process. Connect with our firm today for more information.
