Heymann & Fletcher

Finances require attention when going through divorce

Getting a divorce in New Jersey is an overwhelming enough process without having to worry about how it may affect one's credit. The reality is that the divorce process can negatively impact a person's credit score. This can make it challenging to get a line of credit, secure an apartment rental or qualify for a new mortgage.

During a divorce proceeding (and at other times as well), failing to make required payments on time can directly impact credit ratings. For instance, not making a car, utility or mortgage payment when due may lower one's credit scores. If one of the parties to a divorce assumes responsibility for paying off a debt associated with a joint account, but doesn't do so, the creditworthiness of both parties may be affected.

Sometimes, a devious spouse intentionally runs up joint credit card debt without the knowledge of the other spouse. Thousands of dollars' worth of debt could end up being amassed, and paying it all off may be the responsibility of both parties. Not doing so can harm the credit scores of each individual.

As soon as it becomes clear that divorce proceedings are on tap, the best approach may be to separate all joint accounts right away. The handling of joint financial obligations is a crucial part of most divorce proceedings. A lawyer in New Jersey can help negotiate a fair and comprehensive settlement agreement that focuses on fully protecting the client's legal rights and seeks to resolve all material financial issues in a manner that protects his or her credit standing.

Source: nasdaq.com, "3 Ways Divorce Can Affect Your Credit Score", Shawn Leamon, Jan. 10, 2017

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