Preparing Your Finances and Your Credit For Divorce

Getting divorced is stressful in itself.  When you mix the hassle of untangling your finances to it.  Well saying its a headache is putting it mildly.   In some divorces, each spouse is mature, split the assets and liabilities, and play fair.  But in others, (for instance a family member of mine)  her husband ran up the joint credit cards with cash advances and stopped paying their mortgage without her knowledge.   As they work on finalizing their divorce.  Things have gotten nasty.  Mostly over these money and credit issues.  She went from having nearly had an 800 credit score to a 605 and needing us to co-sign for her new townhouse since she no longer qualified on her own.

Along with the emotional stress of the divorce, there are usually some big financial pressures that cause a bad situation to become even worse. If you want to maintain a good credit score, then you have to put aside your emotional stress to think rationally about how you are going to deal with all the credit and debt responsibilities after you get divorced.

Getting Financially Prepared For Your Divorce

It’s important that you take your finances and credit into your own hands.  Even if things look like it will be settled amicably.  It’s better to be safe than sorry later on!

There are a few things that you should keep in mind when you are about to face divorce.  While the final decision on how the debt is split can wind up in the judges’ hands if you can’t come to an agreement.  It’s always best to be prepared for the worst and have a plan ready to manage your credit.   And keep in mind it’s better to NOT have to go thru credit repair or have to rebuild your credit after a divorce if you can possibly help it!

You Got This! Preparing For Your Divorce

• If there is a credit card that you are a co-signer on, but don’t use.  Try to get your name off it.  Be prepared.  Most banks will require that you pay the card off before they will drop a name from the account.
• Open your own bank accounts and start depositing your money there.  Before closing your old account.  Review your automatic bill pay and make sure you set up the accounts you are responsible for in your new account.
• Change all your passwords and Pin numbers
• Get your credit reports and look for any past due debts.   Just because your’re soon to be ex says they will pay a debt, doesn’t mean they will!  You need to monitor your credit and keep a close eye on your joint accounts.
• Place a credit freeze on your credit report.  Why?  You don’t want anyone to be able to access your credit report.  With a credit freeze, no one can see your credit report without having the pin number and paying the fee to un-freeze it.  Read more about
• Credit Freezes Here. 
• In case of home equity loans, it is possible that the lender will require you to refinance in order to remove your ex-spouse from the obligation.  Tr
• y to decide if you want the house or if it’s best to sell it and split any equity you have in it.
• Finally.  You aren’t alone.  Rely on your friends and family for support if you need to. Divorce is all too common these days.  Your circle of friends and family are not there just for emotional support.  They may be able to help you navigate the waters of divorce based on their own experiences.

For tips on rebuilding your credit after a divorce.  Read this article  Ex Ruining Your Credit – How to enforce your divorce decree without a lawyer