Patrick M. Noe, Jr., Attorney at Law

Patrick M. Noe, Jr. Attorney at Law

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716-803-8741

Will getting a divorce affect my credit score?

The end of a marriage can be a stressful event, even when it is the best thing for all parties involved. Both spouses have to make several choices that can have a significant impact on multiple parts of their lives. Some of those impacts are quite obvious, such as child custody matters, but others may be unexpected.

Though most people realize that their personal finances may be altered by divorce, they're probably thinking about assets or property. However, did you know that divorce can affect your credit score? It's not a direct influence – you don't lose points simply because you're divorced – but the overall changes to your finances can, in turn, negatively affect your credit score. Fortunately, experts have advice for anyone considering divorce here in New York or elsewhere that can help minimize the impact on a person's credit score.

Why did my credit score go down after divorce?

Financial professionals say that there are two main reasons that your credit score drops due to divorce. First, while creditors don't hold it against you that you're divorced, they also won't do you any favors just because you're going through a tough time, either. If both of your names are still on a loan at the finalization of your divorce decree, and your ex-spouse neglects to make proper payments as ordered by a judge, that will affect your credit score.

Similarly, if you and your ex ever shared any joint accounts, the divorce will not automatically take them off of your credit report or erase the accounts. A late payment made by your ex-spouse goes on your credit report, too. Some people's exes may even fail to make payments on purpose, knowing that it will negatively affect the other person.

So, how do I protect myself?

Fortunately, there are ways for you to protect your credit score during and after your divorce. Closing any joint credit cards or taking your ex off as an authorized user from your accounts or credit cards is the first step. You can also freeze your credit reports so that your ex can't open accounts in your name. If at all possible, cooperation is the best solution.

You and your spouse could refinance an asset you once jointly owned, such as your house, so that only one name is on the loan. If that is not cost effective, selling the asset and dividing the profits may be the best way to go. The process may be complicated, but it is vital in protecting yourself.

Women may see more of an effect on their credit score

Since women are frequently out-earned by their husbands, they often feel the financial pinch more in a divorce. One study showed that 54% of women who got a divorce saw their credit scores go down during their marriage. If their income is lower than their ex-husband's, they may have less means to meet financial obligations, thereby dragging down their credit score.

Though this advice might make you feel as though your situation is dire, the good news is that you can rebuild your credit with time and good financial habits. Anyone who is concerned about his or her financial health after divorce may want to assemble a team of professionals who can serve as experienced guides. A financial advisor, a divorce attorney or even a therapist can be invaluable resources to those going through the divorce process.

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Patrick M. Noe, Jr.
1301 North Forest Road, Suite 2
Williamsville, NY 14221

Phone: 716-803-8741
Fax: 716-565-1575
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