Don’t Let Divorce Devastate Your Credit

This post was recently featured in The Huffington Post.

The ending of a marriage is a difficult process for everyone involved. Even if you are the one who “wants’ the divorce, it can be difficult to watch the impact it has on all those that it touches. If your spouse doesn’t want to be divorced, it can be difficult to watch that person struggle with the change. Needless to say, if the divorcing couple has children, the impact it has on the kids can have long lasting effects.

Many people who go through the divorce process also suffer long-lasting effects to their consumer credit. Indeed, a large majority of people that we help at my credit restoration business had “great” credit until the “Big D” happened. But somehow, during or after the process of dissolving the marriage their credit was severely damaged.

Sometimes this process is unavoidable. Maintaining two households on an income that used to pay for only one can lead to missed payments.

More egregiously, if the spouse who is the primary breadwinner chooses to use their earning power for leverage, they can simply stop paying the bills. Although this process more than likely damages both their credit, as well as their spouse’s, it can give them enormous negotiating power in the divorce. If the mortgage isn’t getting paid and creditors are calling the house for payment, a spouse who may not be in a hurry to get divorced may become motivated to get things over with and “settle” for less than they otherwise would.

A spurned spouse may also start to refuse to pay bills simply to “get back” at their soon to be former partner. Once again, both members of the couple’s credit will be damaged, but the spurned spouse “doesn’t care” they just want to get back at the husband or wife that no longer wants them.

That same rejected or angry spouse can also damage their ex’s credit after the divorce has been finalized. We frequently see instances where the order granting a divorce directs one party to pay certain outstanding debt that was incurred by the married couple. What happens if that party refuses to do what the court ordered them to do?

Our clients are frequently surprised when a creditor comes after them for debt that their ex was ordered to pay in the divorce decree. Guess what? The creditor was not likely a party to the divorce case. They don’t care if your ex-husband agreed to pay for a debt in the divorce. If you jointly acquired that debt while you were married, you remain responsible for it and they will come after both of you for payment. If your spouse doesn’t pay what they agreed to in the divorce or even if they fail to pay on time, it will likely be reported against BOTH of your credit history.

Pretty incredible, eh? You can take your ex back to court and have the court find them in contempt or request that the court order them once again to pay the debt that they previously agreed to pay, right? Going to court costs a significant amount of money. Attorneys fees can add up quickly and it is likely that your attorney is going to want to be paid before they head back to court on your behalf.

It may cost you as much to go back to court as the bill that you are going to court over. What if your spouse still refuses to pay or claims an economic inability to pay? More attorneys’ fees are a strong possibility.

Incredibly, many people end up paying the debts their ex promised to pay themselves. The damage the unpaid bill causes to their credit score costs them serious money. Additionally, they may not be able to obtain certain financing, like a mortgage while that unpaid debt is showing up on their credit report. Those credit cards in both of your names and that co-signed mortgage don’t seem so romantic anymore, do they?

Has your credit been damaged or destroyed by a divorce? Don’t give up. Credit is forward looking. A good credit restoration company can help you deal with problems like an unpaid debt that was supposed to be paid by your ex as part of a divorce decree. They can also help to educate you about how credit scores really work and give you the tools to get your score where you really would like it to be.