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Bucks County Divorce Attorneys > Blog > Family Law > Your Credit Score And Divorce Impact

Your Credit Score And Divorce Impact


There are an array of possible financial ramifications when a couple divorces. And while asset division and property ownership may be the first financial items that are discussed, another factor is the impact on a person’s credit score when they go through the divorce process.

In Pennsylvania and New Jersey, divorce can create changes to a person’s credit score, especially if they have co-signed loans or have joint credit accounts with their spouse. To learn about how to protect your credit while dissolving a marriage, talk to a Bucks County family attorney.

Debt Co-Signers and Joint Accounts

One of the most common ways that divorce can impact a person’s credit score is through co-signed loans or joint accounts. When a couple takes out a loan or opens a credit account, they are both responsible for repaying the debt. While this is natural during a marriage, it also means that if the person responsible for payments stops making them after the couple separates, it can negatively impact the credit score of both parties.

During a divorce, all joint debts must be divided. Sometimes this can smoothly happen through negotiations, but in other situations debt division is a complex and contentious process. To protect your credit score so you can access credit on solid terms in your post-divorce life, separate your credit accounts from your spouse’s. The following steps can be helpful.

  • Transfer joint credit accounts to individual accounts
  • Close joint accounts
  • Negotiate payment plans with lenders

Monitoring your credit report as you close and open accounts is advised as well. Then, if you notice any unauthorized activity, you can fix the situation immediately.

Establishing a Comprehensive Divorce Agreement

A full review of debts is also required in order to create a well-crafted agreement. A comprehensive agreement will include provisions for the division of joint debts and assets, as well as a plan for making payments on outstanding debt responsibilities. Addressing these issues now is important, as there can be future legal disputes or damage to credit scores when accounts are missed, avoided, or go undiscussed.

Ending a marriage on its own does not impact a person’s credit score, instead a credit score can be impacted when financial accounts are not well managed. After all, credit scores are based on a variety of factors, such as payment history, credit utilization, and length of credit history. Because of this, if you are  forced to take on more debt or experience an income reduction due to divorce, you may have a hard time making payments on time and maintaining a good credit score.

To talk through your credit score concerns, speak to a Bucks County family attorney. A lawyer will give you the proactive advice you need, such as separating credit accounts from your spouse’s, establishing a comprehensive divorce agreement, and monitoring credit reports regularly in order to avoid future disputes.

Are you banking on a good credit score to set up the life you want after your divorce is finalized? If so, protect their credit during the divorce process, connect with the legal team at Kardos, Rickles & Hand. Call 215-968-6602.

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