Strategies for Improving Your Credit Score after Divorce
First – find out what your credit score is! You can do that for free online. Studies show that financial problems are one of the major factors contributing to divorce in the United States. Accordingly, it’s not uncommon to come out of a marriage with a credit record that is less than stellar. But there are steps you can take to begin to rebuild your credit rating.
Establish Your Own Credit
The first thing you want to do as part of a divorce is close down all joint credit accounts and open new accounts in your name only. A word of caution—your credit score may drop a bit immediately after you close accounts, as your credit score is based in part on the amount of credit available to you. As soon as you open new credit accounts, it should return to the previous level. TALK TO YOUR ATTORNEY BEFORE DOING ANYTHING!
Pay All Your Obligations on Time or Ahead of Time
Now that you have control of your expenses, make certain that you pay all your bills before the due date. A single late payment can have a dramatic impact on your credit score. Pay your bills first and use what’s left over for discretionary purchases. If you have insufficient income to pay all your bills, pay all installment loans, such as house and car payments first, then all credit card payments, then rent, then utilities. If possible, work out a plan to pay utilities over time.
If you have income left after paying your bills, put some of it away. That will help you cover any emergencies, so that you can still pay your bills in a timely manner.
Monitor Your Spending
Divorce is a highly emotional experience, and one of the common ways to stifle our emotions is to buy stuff. Resist the urge. In the first year after a divorce, don’t buy anything that you don’t need. The less you spend on frivolous items, the easier it will be to pay your bills, and the sooner you will have a solid credit rating again.
Contact the Law Offices of Kelly Berton Rocco
To schedule a free, 30 minute telephone consultation to discuss your concerns, send us an e-mail or call our office at 201-343-0078. All calls and e-mails are returned within 24 hours. We’ll be at your side every step of the way.
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