How To Protect Your Credit After Filing For Divorce

If you weren’t aware of how to protect yourself before your divorce started or you have found out that even though you have done

everything right, you are still left with the threat of a black mark on your name because of credit accounts that may not even be your responsibility, then you are not alone.

Thousands of divorces happen every day and, in most cases, someone or maybe even both people involved in the divorce get a bad deal. There are ways that you can protect your credit and prove to creditors that you, as an individual, are trust worthy and deserving credit. Here is a plan and some tips that you can use.

Know where you stand

Once the divorce is over, you can begin by finding out exactly where you stand with creditors by getting hold of your credit report and reading it. You will be able to see your current and past credit history.

To get a credit report, you must ask one of the three major credit-reporting companies. In some states, citizens are offered at least one report every six months, free of charge. By calling one of the credit reporting companies, they will supply you with all of the details needed to obtain your report.

Credit reports can be difficult to understand. If you have a problem understanding your credit report or just want someone to help formulate a plan for your credit future, there is help available. You can book an appointment with a credit report review counselor.

Take steps to protect your credit

Speak to your ex, even if this must be done through a mediator, and go through all of the debts that you both incurred during your marriage and discuss who will be responsible for each debt that is owed. When a reasonable outcome has been decided, you will then need to call all of your creditors and request that the balances of each joint account be transferred to the person who is responsible for paying them.

That way you will have control over your own debt and don’t run the risk of even more debt occurring if your ex partner decides to go on a spending spree with one of the cards that you are responsible for. Just a word of warning, though, even if you do ask the credit company to change these accounts, the creditor is not obligated to make the changes. If they do, they may ask the person responsible for the payments to re-open a new account as an individual before closing the other credit account.

The risk here is that if a creditor chooses not to give the person a personal account, then both parties, you and your ex, are still responsible for the payments for the credit, even if you have decided differently in the divorce settlement. If this does happen, it may be a good idea to freeze any spending on the account until it is paid in full, then close the account.

Prove yourself worthy of credit

Getting credit can be tricky, especially if you have never had an individual credit account before. The trick is to start small and work your way up to where you want to be. Try applying for a small credit card with a low balance or, if that doesn’t work out, try getting credit with a department store or financial institution. This is your chance to prove how dependable you are, so make sure that you make your payments in full on time every time.

Keep paying that line of credit this way for around six months. This will prove that you can handle payments of the first card easily. Then apply for another line of credit. If you have trouble getting this, a good idea is to get a good friend or family member who has a strong credit history to co-sign for you.

Be careful not to run up too much credit and if you do rely on someone to co-sign, pay even more attention to your payments because, if you get lazy on your payments, your mistakes will show up in the person’s credit history that co-signed for you. So be aware that you could jeopardize someone else’s credit history if you go overboard.

Be a good payer

Take extra special care to pay your bills on time every time. This will prove to credit companies that you are a good risk. The two years after you separate from your ex will play a big part in how creditors gauge you as a risk and decide if you should have credit in the future now that you are single. Live up to your obligations and pay your bills every time and it will show up in your credit report that you are dependable and worthy of credit.

Use help if you need to

Being single isn’t easy and the chances of having a lot less money to go around can be very real now you only have your own wage or income to rely on. Just because things start to get tough, don’t think that you are left with no option but to file for bankruptcy.

Unique content is vital. Dont rely on automated content. Another thing about bankruptcy is that some of the debts that you are responsible for before bankruptcy can stay with you even if you do file. So even if you do file for bankruptcy, the chances are you will be left with a big black mark on your name and a heap of debts that you still have to pay.

If you are struggling to make ends meet, there is professional help available to negotiate your debts and save your credit rating. By seeing a debt management consultant, you can get help to make a strong plan for your future and help you to budget or even negotiate with creditors that remain your responsibility after the divorce. For a small fee, a debt management plan can save your creditworthiness and keep your head above water.

Ideally, the best time to start planning for your future and saving your credit rating is before divorce hits. By knowing things like how your accounts work and what your obligations are, will help you make an informed decision on how best to proceed.

After the divorce is finalized, you can start creating your own good name and repairing any damage that has been done before, after or even during the divorce. The best way to repair your credit is to pay on time, every time. Eventually, this will pay off for you in the form of a repaired or glowing credit report.

Liz Roberts is a loan consultant with NewHorizon Business Services. They specialize in providing business and consumers with bad credit loans and credit cards.