5 Tips for Smart Money Management and Creating a Good Credit Score During a Divorce

credit report divorce lawyer credit score

How To Maintain a Good Credit Report During Divorce

Debt and Credit Issues Can Create Complicated And Stressful Times. How To Maintain A Good Credit Report During Divorce

credit report divorce lawyer credit score

Folks going through a divorce have many things on their mind. It can be a very emotional and stressful time! At some point you will inevitably need to start looking carefully at your debt and financial situation. When you are at that point, here are 5 basic tips:

Deal with Your Debt – Don’t Ignore it!

  1. Request a Free Credit Report
     

    The first step you should do is order a credit report  from at least one of the three major credit reporting agencies (Equifax, Transunion and Experian). This will list debts attached to your name, both individually and jointly with your spouse.

     

    There are 3 major credit reporting agencies Equifax, Experian and Transunion.  You may want to order a report from one or all of them. You can also obtain one free credit report per year through annualcreditreport.com .  Your divorce lawyer will want a copy anyway. Once you receive it, take time to thoroughly study it. Make sure it appears accurate. Look for errors such as credit lines

… Read More... “5 Tips for Smart Money Management and Creating a Good Credit Score During a Divorce”

Credit Score: Little Known Tip to Protect Your Credit After a Nasty Divorce – Request a Credit Reporting Freeze?

credit score divorceSome divorce cases are really nasty and contentious. I have been handling divorce cases in Dayton, Ohio for almost 39 years and I have seen some doozies! Clients regularly ask how they can protect their FICO credit score after their divorce is over. There are some very good articles that I’ve linked to below about those suggestions. I want to focus on the option of requesting a credit reporting freeze especially if you were the primary breadwinner.

While we always include language in the Final Decree of Divorce that both parties are prohibited from incurring debt in the name of the other party, there is more that can be done. If the divorce has been unusually contentious and if you believe that your ex-spouse will ignore this court ordered prohibition and create new credit cards under your social security number, then placing the credit reporting freeze may make great sense.  By doing this you will prevent the credit reporting agencies from releasing your credit report without your consent. That means no one can get new credit in your name, including you, until you lift the freeze.

If you are in Ohio, read this consumer protection fact sheet: SECURITY FREEZE INFORMATION… Read More... “Credit Score: Little Known Tip to Protect Your Credit After a Nasty Divorce – Request a Credit Reporting Freeze?”

Credit Scores: Using to Evaluate Potential Mates In A Relationship?

Why Looking At Credit Scores Might Not Be a Bad Idea Before Making A Commitment In A Relationship

credit scores relationshipThe Federal Reserve Board has recently published a working paper entitled, “Credit Scores and Committed Relationships.”  In it, authors Jane Dokko, Geng Li and Jessica Hayes explore the potential correlation between one’s credit score and their likelihood of being a good partner or spouse.  The study’s results seem to suggest that people with higher credit scores are more likely to be in committed relationships.  In addition, the authors argue that how well a couple’s credit scores match initially, may also be a good indicator of whether the relationship has staying power.  To read the full study see, https://www.federalreserve.gov/econresdata/feds/2015/files/2015081pap.pdf.

The study conducted between 1999 and 2014, used 12 million randomly selected people from the Federal Reserve Bank of New York Consumer Credit Panel/Equifax.  Within this sample, researchers used an algorithm to find people who lived at the same address as another consumer from the sample.  Certain restrictions were applied to ensure that the pair was in some type of committed relationship.  Their credit scores were then monitored only so long as they retained the same address.  Once the pair no … Read More... “Credit Scores: Using to Evaluate Potential Mates In A Relationship?”

Be Sure to Pull Your Free Credit Report

creport.jpgAs part of the divorce proceedings, your attorney will at some point be trying to determine what credit card debts are in each of your individual names as well as shared accounts and authorized user accounts. Often times, understandably, clients are not sure. The distinction in the type of account is important, as it not only affects future liability on the account but also future reporting to the bureaus.

The liability for an individual account lies with the person whose name is on the account (presumably the person who opened it). A shared or co-debtor account allows the credit card company to go after either or both parties on the account. An authorized user situation creates a more complicated scenario. The credit card company cannot attempt to collect payments from a mere authorized user. Their recourse for collection is against the individual whose name is on the account so long as the authorized user did not sign the application or give their social security number to the credit card company. But it is important to know that the credit card companies will still report the payment history on both the individual owner and the authorized user to the credit bureaus. … Read More... “Be Sure to Pull Your Free Credit Report”

Avoid Headache, Safeguard Your Assets

Jeffrey Lalloway, publisher of the California Divorce and Family Law Blog, wrote this excellent article. I couldn’t agree more with his suggestions!

Lessen impact of divorce on credit

Avoid HeadacheIf you’re planning to file for divorce this year or are already splitting your assets with your soon-to-be ex-spouse, your credit is likely to take a hit.

Many people don’t realize that lenders do not honor court decrees that assign payment responsibilities for joint loans. The mistaken assumption that you’re off the hook for financial obligations can result in a series of missed payments that may trash your credit score for years.

This needn’t happen if you safeguard your credit before you file for divorce. Consider these tips from John Ulzheimer, author of “You’re Nothing but a Number” and an expert at Credit.com, a consumer personal finance site.

If you have joint accounts with your spouse, do your best to turn them into individual accounts so that it will be easier for the divorce court to split up your financial responsibilities. To do that you will need your spouse’s permission, which means you’re going to have to let the cat out of the bag. But taking these steps now can save … Read More... “Avoid Headache, Safeguard Your Assets”