Does Divorce Affect Credit Scores?

How much can divorce affect credit scores?

I never thought it made much of a difference, and was always offended by financing ads aimed at people who had lost a job, gone through a divorce, or had no credit history. Come on, is getting a divorce really as bad as losing your job? Little did I realize just how much getting divorced could affect my credit until I went through it myself.

The Reality of Too Little Money

After the big split, I found myself maintaining the same household on greatly reduced resources. On top of that, I had taken on a higher portion of the debts to insure that they were paid. Unfortunately, what was manageable while I was married soon became the ultimate juggling act as I tried to pay bills before their due date.

Next thing I knew, the state had placed a lien on my house and vehicle due to unpaid taxes on my ex's business. While I was still reeling from that shock, I was notified by a collection agency about my ex's delinquent credit card debt (which wasn't disclosed during the divorce). Thanks to community property laws, I discovered that I was equally responsible for that debt. Before I knew it, my good credit had gone down the toilet.

The Lingering Effects of Divorce

Regrettably, my story isn't unique. Many divorced people find their credit in shambles in the months and years after their divorce. And while it's true that most people are able to financially bounce back after their divorce, their credit scores don't tend to rebound near as quickly.

Why you should worry about your credit score

Even if you don't know the difference between a bowling score and a credit score, it can affect your life in many ways. Want to rent a house or an apartment? Without a good credit score, a potential landlord may turn down your rental application. Since part of your credit score is determined by how you've paid debts in the past, a poor score indicates that you may not pay your rent on time. Your score may also determine how big a deposit you will have to pay for telephone, electricity or natural gas service.

Credit scores affect whether you get credit extended to you, and how much you will pay for credit cards, auto loans, mortgages and other kinds of debt. Overall, a higher score means that you will be more likely to be approved for and pay a lower interest rate on new credit accounts that you open. In the end, having a good credit scores will make your financial dealings a lot easier and can save you money in lower interest rates.

©Tracy Achen 2008
At WomansDivorce.com we have one focus - helping women survive their divorce and rebuild their lives. Get more information about how to protect yourself during divorce in Divorce 101: A Woman's Guide.

Now that you've learned how divorce affects credit scores, you can start making changes as soon as the two of you decide to go your separate ways. For more information about protecting and rebuilding your credit, check out the following articles:

Divorce and Credit Card Debt
Handling Divorce Debt
Protecting Your Credit During Divorce
Rebuilding Your Credit After Divorce
Return from Divorce Affect Credit to Money Issues

Home / Articles / Divorce Guide / State Resources / Divorce FAQS

Books / Store / Contact Us / Chat / Privacy / Links / Newsletter