Find Out How A Divorce Can Influence Your Credit Score
The information on how many marriages end in divorce are confounding. And as emotionally upsetting as a divorce can be all too often it also has an terribly negative consequence on your finances too.
Oftentimes there are people who have been responsible and unfailing with their credit for years who end up with major problems following a divorce. Divorce is one of the main causes of challenging credit for many people.
When you are married you and your spouse are often equally treated as likewise liable for repaying loans like mortgages, car payments and credit cards. When the separation happens the courts usually hand over responsibility to one or the other party. However, even though this is by order of the court many times the creditors will overlook it, especially if the loan goes delinquent.
A divorce decree does not show up on a credit report. If the ex-spouse who is accountable for the balance due misses a payment the creditors can and will attempt to collect from the other party. Both parties will also have the delinquency reported on their credit reports. If your ex-spouse is supposed to pay but doesn’t, you will be held answerable.
Since you have split households and you are no longer getting mail or notices at the same address, you may not even be attentive that there is a difficulty with the old debts until it is too late and it is already reported on your credit.
While having your credit report being affected may seem bad enough if the other partner decides to declare bankruptcy, you could be held accountable for the full amount of the balance even though the courts assigned it to your ex spouse. You may be targeted by the creditor as the only option accessible for them to collect the money owing.
It is disappointing but at this time the credit system is exceedingly unfair to the parties of a divorce. Often the only way to entirely tie up a divorce is to declare bankruptcy. This is very unfortunate if there is one party who strives to be responsible and desperately wants to keep a untainted credit record.
However this state of affairs is just one instance of why it is valuable that we have the right and we can repair our credit. We can dispute any item on our credit reports, including bankruptcies that we feel may be inaccurate, untimely, incomplete, ambiguous, misleading, untimely, unverifiable, prejudiced or unclear.