One question many people wonder what kind of financial impact divorce can have in their lives. While most people think about child support and alimony, they might actually be missing out on a lot of information about their finances. For instance, could your divorce impact your credit score?
Many people do not realize how much divorce really can impact their credit, but it's something every divorce attorney wants their client to understand.
Divorce Can Reduce Your Household Resources
One of the first things you need to know is that divorce can severely reduce your resources, whether you receive or pay support payments or not. For instance, you might be missing one additional income from your family home, which can make it much more difficult to pay off your bills if they have not changed much. This means you might fall behind on some bills, which can severely reduce your credit score over time.
Divorce Can Stick You With the Debt
In some divorces, the debts are divvied up. If you are afraid your ex-spouse will not make payments on debt, you might agree to take it on yourself. Taking on debt may be in the best interest of your credit long-term, but it can also provide you with the dilemma of having more bills to pay.
Divorce Can Still Link You and Your Ex
If your ex fails to pay taxes on a business or another entity you are or were a part of, you could see a lien put on your house, vehicles, and other properties. It is in your best interest to speak with your attorney about separating yourself as much as possible from your ex so that you are not stuck with the bill if something goes wrong. A lien could take money away from your very limited resources.
Talk to Your Divorce Attorney to Protect Yourself
If you fail to protect yourself, you could face difficulties buying a house, renting an apartment, getting a new vehicle, or even getting utilities turned on in your home. Your credit score impacts you much more than you might think.
The good news is that you can prepare for divorce financially, and you can prepare for the aftermath. It is important that you discuss your financial status with your divorce attorney. Make sure that you pay close attention to your attorney's instructions and be as honest as possible about your needs.
To learn more, talk to a firm like Katzman Logan Halper & Bennett.