According to most marriage experts, differences about money are the leading cause of conflict in a marriage – and a leading contributor to divorce. But even if you and your spouse didn’t have money issues during your marriage, you may create them if you don’t take the necessary steps to protect your own credit during a divorce:
Step 1: Get your credit report.
You are entitled by law to obtain one free copy of your credit report every year from the three credit bureaus: Experian, Equifax and TransUnion. You can access these reports at annualcreditreport.com.
Step 2: Make a list of creditors.
From your credit reports, make a list of all your creditors for both secured and unsecured debt. Secured creditors are those that can attach an asset as security for a debt — a home, car, boat, etc. An unsecured lender is one that lends you money based on your promise to repay, and include credit card debt, medical debt, etc.
Step 3: Separate joint from individual accounts.
Note on your list of creditors which debts are joint (in both your names) and which are individual accounts in your name only.
Step 4: Contact joint credit card lenders.
Find out if the lenders extended credit based on your history or your spouse’s history. If it was based on your history and your spouse has a card, ask the lender to remove him or her. If it was based on your partner’s history, ask to have yourself removed. If it was based on both of your histories, you should close the account. Most lenders will not do this until the balance has been paid off, but you can ask to freeze the account. Once it’s paid, close it and open new accounts in your name only.
Step 5: Refinance or sell secured assets.
If a mortgage or car loan is financed in both names, you will both be responsible for the debt, no matter whose name is on the deed or title. To eliminate your liability for an existing loan, you will need to either sell the asset and pay off the loan, or refinance the loan in one name only.
By handling cases with the dignity and respect they deserve, we have helped many families in New Jersey civilly resolve their divorce, rebuild a satisfying life, and confidently step into the next chapter of their lives. Contact us today for your free consultation.