A divorce can be extremely difficult and is a life-changing experience. Most individuals are unaware that in addition to the stress, a divorce may affect their credit. It is not the divorce itself that can damage your credit score, but fairly common and indirect after effects. Your credit is not determined by your marital status, but the actions of your spouse can decrease your credit score. It is always a good idea to ensure good legal counsel has been obtained. For this purpose, please visit divorce lawyers in Tampa.
The Payment of the Joint Bills
When there are joint credit accounts remaining after the divorce, this can be a problem. This can be credit cards or a mortgage, and these bills must be paid. Sometimes the judge will make a ruling a certain amount of these bills must be paid by the ex-spouse after the divorce. It is crucial to ensure the ex-spouse is paying their share of these bills. If the ex-spouse is not worried about their credit score, they have absolutely no incentive to pay these bills whether they are secured or unsecured. Your ex-spouse may deliberately choose not to pay these bills because they belong to you.
The issue is if these bills are under your name, and they are not paid, your credit score will be damaged. It makes no difference who was supposed to pay these bills. The person responsible, and the one who must deal with any resulting credit issues is the individual with their name on the accounts. One solution is to ensure you have a good divorce lawyer who will consider situations like this in advance, such as a Tampa divorce attorney. Another solution is try to maintain decent terms with your ex-spouse so they will honor their financial end of the deal. If your ex-spouse will not make their share of the payments, you must pay these bills. It does not matter who was named as the responsible party according to the terms of the divorce. It is possible to recover these funds at a later date by reporting the issue to the courts, but not paying these bills has severe implications regarding your credit.
The Inability to Pay Bills
During the course of a complicated divorce, attorney fees can become expensive, and sometimes the ex-spouse was the one making the bulk of the money. This may leave you in a situation where you do not have the money to pay the bills. This can cause high credit usage, late payments, and fees, and damage your credit score. The most important aspect regarding your credit score is your payment history. If your payments have not always been on-time, your credit score may have been decreased. If you are unable to make your payments on time, your credit score can drop farther.
If you are using your credit cards as a supplement to your income, there is a good chance you are using too much credit. When your credit usage is considered high, your credit score can be decreased. Once your balance-to-limit ratio has exceeded thirty percent, your credit usage is considered high. This can limit your financial options. There are only two ways to increase your funds each month. The first is to increase your income, and the seconds is to lower your expenses. You may be able to increase your earnings with overtime, doing freelance work, or taking a second job. Any expenses that are unnecessary should be cut. This may including restaurants, subscription and cable services and personal care spending.
The Vindictive Ex-Spouse
There are cases where a couple divorces with very little drams, but sometimes this is not possible. If your spouse has access to your accounts and is angry, they may become vindictive and accrue debt under your name. This is common with individuals who are authorized users for credit because they have no payment responsibility. If your ex-spouse is still authorized to use any of your credit cards, this is essentially an invitation to spend money with no consequences. Since not paying this debt will damage your credit, you must resolve the potential issues.
All credit accounts containing your spouse’s name must be updated, and their name removed as quickly as possible. If you are not able to accomplish this fast enough, and your ex-spouse begins making charges, cancel the cards. Never assume your ex-spouse will deal with the divorce gracefully. Always minimize any negative credit impacts during the process of a divorce. The most important thing you can do is ensure all your bills are being paid on time, and remove the name of your spouse from all possible accounts immediately. The more civility you show to your spouse during the divorce, the better the chances your spouse will not attempt to destroy your credit.