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Many divorcing couples worry about the financial impact of their divorce proceedings, including how their divorce might impact their credit. While the proceedings themselves don’t affect your credit score directly, your credit score can be indirectly affected.

Managing Your Credit During Your Divorce

Credit scores are calculated based on a host of factors, including your credit history; whether you’ve made your past payments on time and the length of your credit accounts can influence how high or low your credit score is. During your divorce, your credit history and score may be affected when joint accounts are split and your income changes.

Your credit can also be affected if you do not properly plan how you will manage your debts and credit while your divorce is ongoing. Below, we will discuss ways in which you can protect your financial health and manage your credit score during your divorce.

  • Take stock of your assets and debts. During your divorce, you and your soon-to-be-ex-spouse will have to divide your assets and debts. If you are filing uncontested, you both will need to agree to the terms of the divorce, including details concerning the division of debt. Having a list of your assets and debts can be helpful during the division process. This list can also help you identify debts and accounts that are joint.
  • Create a plan. If your savings and many assets/debts are intertwined, you should consider what you want to happen once the divorce is finalized. Working with an attorney consider what you hope for in terms of the division of assets and debts and consider examining your accounts to see who contributed to or managed them.
  • Close or separate your accounts. It is important to note that if you and your partner are cosigners or joint owners of an account, you are both legally responsible for it as long as the account or loan remains pen—irrespective of your divorce decree or other agreements. You should consider closing a joint account before the divorce or removing one party’s name after the proceedings (when possible). Some accounts may not be eligible to be closed, but you can talk with the lender or account issuer to ask how you might remove the other party from any open accounts.
  • Be responsible. During your divorce, you should engage in responsible debt management practices and adhere to a budget. Continue to make your payments on time and monitor your credit and accounts throughout the process. If you notice the other party is damaging your credit or using marital funds wastefully, you can work with your attorney to

Does a Divorce Decree Void Lender/Loan Contracts?

No, your divorce decree outlines who is responsible for accounts and debts based on your property and debt division agreement. However, your divorce decree does not break your lender contracts.

Can You Remove a Mortgage from Your Credit Report After a Divorce?

If you have a joint mortgage and both you and the other party’s name are on the mortgage, the mortgage will remain on your credit report, and your credit can be impacted if payments are not made. Even if the other party is given that debt in the divorce, your credit can be affected as long as your name is on the mortgage. You likely do not want to worry about where your ex-spouse will make the payments on time or default on the loan.

However, you cannot simply remove your name from the mortgage. Since the lender gave you the mortgage together, they may not be willing to remove either party from the loan. If the party who is not responsible for the mortgage after the divorce wants to remove it from their credit, you will need to consider refinancing options, repayment options (that allow you to pay the loan off quicker), or selling the property.

Affordable Divorce Services in Pennsylvania

At Cairns Law Offices, we are dedicated to helping our clients navigate the divorce process without having to break their bank. Known for offering premium divorce services without the premium price, our firm can help you:

To learn more about our services or get started, contact us online or via phone (888) 863-9115.

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