When you’re going through a divorce, your finances may not be at the top of your mind. It’s an emotionally challenging time and you may be preoccupied with child custody, property, or insurance issues.
While a divorce alone won’t hurt your credit, certain consequences of the divorce could. If the relationship ends on bad terms, missed or late payments will tarnish your credit. For example, if you have joint accounts with your spouse, missed or late payments could affect your credit report. You need to make sure that accounts with your name have payments made in full and on time.
Take steps to protect accounts in your name. You may want to:
- Obtain current credit reports so that you can see all accounts listed in your name, and those listed jointly. Read more: The value of an accurate report is priceless.
- Establish a budget and payment plan for your obligations. Pay attention to obligations that you must pay, such as mortgages and utilities, and those that may be considered as luxuries.
- Evaluate accounts in joint names. Discuss with your attorney whether these accounts can be closed and/or reassigned to you or your spouse.
- Learn the difference between credit score and credit report.
For more detailed information on how to handle your finances during a divorce, read this article by FTAdvisor. Look for a divorce lawyer that is aware of the types of consumer protection issues that divorce clients face.