A divorce can have a significant impact on a person’s credit score. Therefore individuals in Florida and throughout the country who are planning on ending their marriages are encouraged to take proactive steps to mitigate the potential damage. Ideally, a person who is getting a divorce will obtain copies of his or her credit reports from the three major credit reporting agencies. Individuals are allowed to obtain a free credit report once a week until April 2021.
It is a good idea for a person to remove a spouse as an authorized user on a credit card. It is also important to keep an eye on joint accounts throughout the divorce process. This is because an individual may be responsible for paying a balance owed on a joint credit card or other loan account until it is paid off or refinanced in the other spouse’s name.
It is a good idea for an individual to review his or her credit report after an account is closed to ensure that the closure has been reported properly. After a divorce is finalized, individuals may want to consider freezing their credit reports. This ensures that former spouses are unable to open new accounts in their name. Credit reports can be temporarily unfrozen when a person wants to apply for a new credit card or other type of loan.
In addition to impacting a person’s credit score, a divorce may reduce a person’s net worth and increase his or her living expenses. However, an attorney may negotiate settlement terms that allow for an individual to retain ownership in a business or retain other assets that may appreciate in value over time. This may make it possible for a person to maintain a relatively comfortable lifestyle after a marriage officially ends.