Divorce Affects Credit Big Time
Your marriage is about to dissolve in the divorce court. This is a tremendously emotional time in the lives of both partners. Both will need to learn about how financial issues affect each partner. You may want legal advice to help you with these issues.
It is strongly suggested that the financial issues be worked out prior to the actual divorce date. You need to examine the credit reports for each spouse. Any errors should be fixed so that both reports are accurate. Then you can see what credit issues need to be settled.
If you are jointly responsible for a home mortgage, you may want to sell the home to a stranger. You can also sell the home to your partner. That makes the mortgage no longer a joint responsibility.
Other debts including cars, credit cards, utilities, loans also need to be only in one name. These decisions are not easy ones but are necessary.
Credit cards in both names should be changed to one name. Should this not be done and payments to credit card companies stop, it is possible that the companies will insist on payment from the other spouse. The debt could end up in collections and result in messy collection calls. Such a situation can lead back to court and get nasty. Be aware before something negative happens that the poor credit of one spouse can show up on the report of the other, even if divorced.
Figure out all cash assets and how these will be divided. Do the split, close any joint checking and savings accounts and open accounts in individual names. No one can get to the other's money.
It would be very positive if all joint debts could be paid even if some things have to be sold. This would ensure that each partner is responsible for his/her own debts. You want to move on with your life knowing that your financial base is secure albeit smaller than before the divorce.
Remember that even though the divorce decree spells out the person responsible for debts, this will not negate any joint financial responsibilities which can come back to haunt you if not settled prior to the final decree. Be proactive during the divorce process and get your financial status in order.
It is strongly suggested that the financial issues be worked out prior to the actual divorce date. You need to examine the credit reports for each spouse. Any errors should be fixed so that both reports are accurate. Then you can see what credit issues need to be settled.
If you are jointly responsible for a home mortgage, you may want to sell the home to a stranger. You can also sell the home to your partner. That makes the mortgage no longer a joint responsibility.
Other debts including cars, credit cards, utilities, loans also need to be only in one name. These decisions are not easy ones but are necessary.
Credit cards in both names should be changed to one name. Should this not be done and payments to credit card companies stop, it is possible that the companies will insist on payment from the other spouse. The debt could end up in collections and result in messy collection calls. Such a situation can lead back to court and get nasty. Be aware before something negative happens that the poor credit of one spouse can show up on the report of the other, even if divorced.
Figure out all cash assets and how these will be divided. Do the split, close any joint checking and savings accounts and open accounts in individual names. No one can get to the other's money.
It would be very positive if all joint debts could be paid even if some things have to be sold. This would ensure that each partner is responsible for his/her own debts. You want to move on with your life knowing that your financial base is secure albeit smaller than before the divorce.
Remember that even though the divorce decree spells out the person responsible for debts, this will not negate any joint financial responsibilities which can come back to haunt you if not settled prior to the final decree. Be proactive during the divorce process and get your financial status in order.
About the Author:
With unprecedented challenges in the credit markets it?s more important than ever to have excellent credit. For more information visit Rob Kosbergs' Detailed FREE Guide on Maintaining and Repairing your Credit Score by going to Bad Credit Repair for your FREE information.
posted by Credit Counseling at
1:31 PM
0 Comments:
Post a Comment
Subscribe to Post Comments [Atom]
<< Home