Divorce can seem to change everything. Not only is your marriage over, but you probably won’t live with your children full-time anymore. Meanwhile, you might have to move to a smaller home and have fewer financial resources than you are used to, at least for a while.
Getting divorced might affect your credit score too. Depending on the terms of your property division settlement, you may be taking on debt that you used to share with your ex. If your ex is unscrupulous, they might rack up huge bills on your joint credit cards before you can cancel them. Either way, your credit score could take a significant hit.
Fortunately, you can repair your score over time. Here are three tips:
Know what is on your credit history
Pulling a credit report might reveal some debts and lines of credit you weren’t aware of. Once you know everything out there that is in your name, you can begin working on consolidating your debt and closing old accounts.
Keep up on your payments
One of the most important things you can do to prove your creditworthiness is to pay your bills every month. If you haven’t already, set up autopay for things like your utilities, cellphone, credit cards and rent/mortgage. Try to keep your expenses within your budget, but at least try to pay the monthly minimum on your credit card.
Establish your own credit history
If you did not have extensive credit history before you got married, now is the time to build your history as an individual. Even if your credit score isn’t the best, there are credit cards you can qualify for. You can use it to make smaller purchases and then pay off the balance every month. Over time, your score will go up.
It can take time and patience, but your divorce does not have to destroy your chances of ever getting a mortgage, auto loan or business loan at decent interest rates.