During divorce -- protect your credit
When your relationship is deteriorating, the credit card companies still love you. Divorce is a time of change and great emotional and financial upheaval. Separation and divorce often deal a real blow to the family budget.Taking precautions is important.
How you deal with the related credit issues pertaining to a marital separation and divorce is important for both your short and long term financial recovery. Many credit restoration companies thrive when the divorce rates rise. In challengiong financial times, debt management can take on a whole new meaning.
There are a few basic steps you can take to help lessen the financial pain.
Pay up joint debts and cancel joint credit cards after you get a card in your name.
. Do not pledge the credit of the other spouse.
Consider taking a financial or accounting class.
Try to agree on one appraiser rather than shopping for a "buyers" appraiser or a "seller's" appraiser.
Consider paying off any vehicle loans as part of any house refinancing if possible. When starting anew, the fewer debts the better. Minimizing your debt is probably a good idea regardless of one's marital status. If you are falling behind in bills, due to job loss or illness, do not avoid your creditors and try to work out arrangements. Unpaid debt, joint or individual, will be reported to the three national reporting agencies resulting in lower credit scores.
Remeber that tough economic times are generally followed by long term periods of prosperity. Don't give up hope. Hopefully, you have followed the old parental advice, to "save for a rainy day."
When divorce cripples the family budget, not only does the stress level rise, but so too, does the likelihood of filing for bankruptcy. Despite new laws enacted in 2005 that tightened the requirements for bankruptcy, many people still see it as an easy way out of crushing financial debt. Unfortunately, some spouses also believe bankruptcy will allow them to escape their spousal or child support obligations during or after the divorce; wrong.
If your spouse or ex files for bankruptcy, you should seek legal counsel to protect you rights as a creditor.
How you deal with the related credit issues pertaining to a marital separation and divorce is important for both your short and long term financial recovery. Many credit restoration companies thrive when the divorce rates rise. In challengiong financial times, debt management can take on a whole new meaning.
There are a few basic steps you can take to help lessen the financial pain.
Pay up joint debts and cancel joint credit cards after you get a card in your name.
. Do not pledge the credit of the other spouse.
Consider taking a financial or accounting class.
Try to agree on one appraiser rather than shopping for a "buyers" appraiser or a "seller's" appraiser.
Consider paying off any vehicle loans as part of any house refinancing if possible. When starting anew, the fewer debts the better. Minimizing your debt is probably a good idea regardless of one's marital status. If you are falling behind in bills, due to job loss or illness, do not avoid your creditors and try to work out arrangements. Unpaid debt, joint or individual, will be reported to the three national reporting agencies resulting in lower credit scores.
Remeber that tough economic times are generally followed by long term periods of prosperity. Don't give up hope. Hopefully, you have followed the old parental advice, to "save for a rainy day."
When divorce cripples the family budget, not only does the stress level rise, but so too, does the likelihood of filing for bankruptcy. Despite new laws enacted in 2005 that tightened the requirements for bankruptcy, many people still see it as an easy way out of crushing financial debt. Unfortunately, some spouses also believe bankruptcy will allow them to escape their spousal or child support obligations during or after the divorce; wrong.
If your spouse or ex files for bankruptcy, you should seek legal counsel to protect you rights as a creditor.
About the Author:
If you are involved in a separation and divorce, have concerns about your finances, credit and legal rights get Free Divorce and Financial Information and Resources. It is important to avoid credit problems when you are in transition. At the Divorce Without Dishonor website you can find Free Divorce and Financial Information and Resources
posted by Credit Counseling at
11:07 AM
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