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A split doesn’t have to cause havoc on credit

On Behalf of | Oct 3, 2019 | Divorce |

When Arizona residents decide to seek a divorce, there are many areas of concern in how to build a new life. Finances, including credit score, are of great importance since they can determine quality of life after the divorce. There are steps that can be taken before the divorce decree is final that can protect that score and finances overall.

The road to divorce starts much earlier than the actual division of assets, negotiations and court dates. Protection of finances and credit score should start early. Joint credit cards, mortgages and loans can hurt individuals’ finances after the divorce, so couples should start working toward splitting those up before the finalized divorce. One way is to open an individual credit card with a limit that can be easily paid off by one person before paying off and closing the joint accounts. Another is by removing an authorized or joint user on the account and assuming the responsibilities and liabilities for that card. Cards can also be put into inactive status, preventing any future charges as they are paid off.

Mortgages are more complicated. In some cases, the couple might have to sell their home altogether during the end of the marriage to pay off the balance of the debt. In other cases, one person might choose to keep the home, and refinancing might be involved. The important thing is to have the name of the spouse who is no longer liable or responsible removed from all those accounts so that a late payment does not later hurt their own credit score.

During the divorce process, the guidance provided by a family law lawyer may be valuable. A lawyer may help their client create a plan for the divorce and for their post-split life. The lawyer might also represent their client when meeting with their ex and during court appearances.