Your credit report contains information like your past addresses, Social Security number, and financial accounts. It does not include information on your marriage or divorce. However, Illinois residents would still be wise to pay close attention to their credit reports before and after a divorce.
How divorce impacts your credit report
Most married couples have shared accounts for loan payments, credit cards, and utility bills. If your name is on a loan that your spouse inherits during the divorce, and they fail to make a payment, you will have a late payment on your credit report. This can happen on accident but can also happen as a means of revenge during a divorce.
Your credit report reflects any financial activity on any account listing your name. For this reason, it’s important to separate your joint accounts and be very clear about whose name is on what.
Checking your credit report before the divorce provides an idea of what accounts your name is on. Go through it carefully and determine what will happen to joint accounts. This usually means closing them and then applying for accounts in your own name. However, the fate of joint accounts will be decided in the asset division phase of your divorce.
What to do
Check your credit report after the divorce. Check to see if you are still showing up on accounts belonging to your former spouse. If you are, call the companies to check. Continue to regularly check your report until the information is showing up correctly.
Also, double check all new information is correct. Sometimes you could move and have an incorrect address appear or another error during this time of change.
As you work on checking your credit report, this is also an important time to go over your budget and general finances. Divorce causes a lot of upheaval to routines and life management, which can cause late payments or other issues. If you can, set up auto-pay to make sure you never miss a bill, and it that’s not an option, keep track of all your bills very carefully.
You need a good credit score as you goes through this major change. You may be applying for new loans or places to live. Keep your credit score in good order by regularly checking your credit report and keeping a close eye on your budget.
