Is There Credit After Divorce?

Question

I am thinking of divorce, and I don’t know what to do about my credit cards. Will I be able to get credit after I divorce, or will I have to start over?

Answer

If you are considering divorce, it is important to get your credit facilities firmly in place as soon as you can.

Make sure that your bank cards and department store cards are in your own name, not just as an authorized user on your spouse’s card. That way, your spouse will not be able to cancel your cards and cut off your credit without your permission.

If possible, you should obtain cards with check-writing privileges, so that you will have a source for emergency funds if your cash reserves run low or are frozen by restraining orders during the divorce.

Women who are in the process of divorcing and receive spouses support or child support from their former husbands sometimes have tremendous problems getting credit.

The credit institution is required to take those support payments into account only if you have received them regularly in the past and it is likely that you will continue receiving them in the future. But if you are in the process of divorcing, your support payments have probably been set under “temporary” orders, which by their very nature are subject to change.

Credit institutions may therefore deem those payments unreliable and may choose not to consider them in deciding to grant your credit.

While you are in the process of divorcing, your debt obligations may include amounts that your spouse has agreed to pay, such as the house payment if he is still living in the house, or a credit card that he uses exclusively.

Even though the two of you have agreed that he will make those payments, the credit institution will consider those obligations to be yours as well if you signed the loan application papers. That can keep you from getting the credit you need.

For example, you may find that your are unfairly denied a car loan when the loan payments would fit easily within your budget.

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