Building Your Credit after Divorce

Getting married and having your name changed is a very common practice for a lot of people, however, so is getting divorced. Knowing what to do with your credit in these situations is very important.

If you get married and your spouse has good credit where you have bad credit, keep trying to rebuild the credit on your name, so that at least one of you has a good credit score. A good credit score shows stability to lenders.

If you get a divorce and all of the credit cards are under your spouse’s name, you will need to reestablish the credit under your own name. When you get your first credit report after getting a divorce, your spouse’s name will still be listed on the report. This is because of loans that were applied for together. This means that you are responsible for your spouse’s account, but the credit bureaus cannot list negative items against you if you are divorced.

After getting copies of your credit report, the next thing you need to do is cancel all joint accounts. If you need to contact a creditor for any reason, you can ask them to look at your spouse’s credit history as well, but let the lender know that you are now divorced and starting your own credit line. If you apply for credit cards be sure that the cards are in your name and use them wisely. Credit cards can help rebuild your credit quickly, but they can also do a lot of damage if not paid off on time. Because of this, make sure that you pay the minimum balance on your credit card accounts each month to avoid delinquencies. If you have to make a choice between paying your bills or your credit card, pay your bills and deal with the credit card later. This method not only keeps you out of trouble with other creditors, but offers a solution for repairing your credit. If you can afford to pay your bills each month and use your credit card, be sure to only purchase items you absolutely need. If it is possible payoff your credit card balances each month to avoid interest. Interest rates cost you a lot more money in the long run, so paying off your dues on time can save you money.

If you don’t have credit cards and decide to choose a card be honest on your application and look for the best interest rates available and for cards that offer cash back rewards. If you are in debt it is wise to payoff your dues before applying for a credit card, unless you intend to use the card to get out of debt. When you have a credit card it is important that you are consistent with the use of your name. For example, if your name is Robert Leon Swisher Jr., always sign your name accordingly. Do not use your card dishonestly because lying will only get you into deeper debt. If you are out of work, lived at your resident for less than a year, or you have negative accounts on your credit report, this is not a good time to apply for a credit card. If you are stable it is always wise to apply with lenders whom you have done business with before.

Building your credit after divorce is difficult at times; however, it is not an impossible task. It is important that you are aware that most credit card solicitations are gimmicks that only offer you a solution for hanging yourself. Instead of getting out a rope, it is wise to stay alert, and investigate any credit card offer made available to you. Finally, you want to avoid low introductory rates on credit cards since after about six months the interest rates often hit the roof. If you follow these tips, you will find yourself out of debt before you know it.

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