When Divorce Ruins Your Credit.....

Divorce can wreck havoc on your credit rating, which not a good thing when you are trying to rebuild your life financially after a divorce and discover your credit ranking has plummeted. It may be difficult or next to impossible to preserve your good credit standing during a divorce if you are dealing with an ex who refuses to pay the bills. If your name is on credit cards, mortgages, and other bills with your spouse and those bills are not paid, your credit is going to suffer.

There may be no way to avoid a decrease in your credit ranking if you are in this situation, but you can try and repair some of the damage after the divorce is final. Often, in a divorce settlement, both parties will be responsible for their own debt or one spouse will be ordered to pay the other for outstanding credit card bills and other debt.

Even if your divorce settlement clearly states you are not responsible for the debt, creditors do not have to honor that agreement and can still pursue you for the money. You would need to take your ex back to court for violation of the divorce settlement should that happen.

After the divorce it is important to get copies of your credit report from the 3 major agencies: Equifax, Experian, and TransUnion. (Once a year, you may obtain a free credit report by visiting www.AnnualCreditReport.com.) Make sure your ex's debts are not showing up on your credit report. If your ex had a credit card and you were the additional cardholder, not a joint cardholder, then you are not responsible for that debt. Sometimes, though, those debts will appear on your credit report anyway. You need to go over your report carefully and contact the agencies if there any discrepancies.

Even if your credit score is low, you can raise it over time. By paying all bills before the due date and not missing any payments, you will slowly begin to rebuild your credit. As you get back on your feet, you can begin to make larger payment to pay off old debts. It may take a few years, but you can get your credit back on track again.