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Beginning again: Rebuilding credit history after divorce

Divorce has a way of changing financial outlooks, and people in Michigan who are attempting to reevaluate the state of their budget may discover that things do not seem as rosy with one income as they did with two. Starting over often requires new housing, transportation and appliances, to name just a few of the expenses, but it may also involve building a new credit history, too.

According to TheBalance.com, a newly divorced person should eliminate any credit cards that are shared with the ex-spouse, either by canceling them or removing one person’s name from the account. Joint debts may have been divided along with the marital assets, but as long as both names are on the debt, both parties can be held responsible for it. So, it is important to make sure that the ex-spouse is making the payments that he or she has been ordered to pay.

Opening a new line of credit is one way to raise a credit score, but a woman who wants to change her name may want to this before applying so that accounts will not have to be changed twice. If making a credit card payment in addition to paying other living expenses would create hardship, it is better not to apply for one, since missing payments damages credit more than making them builds it. Experian.com explains that a person who wants to refinance the family home or apply for a loan for a new one may not be able to get a mortgage if he or she cannot pay credit cards on time.

A divorce agreement that leaves one spouse unable to meet obligations may not be fair, but couples who can cooperate may be able to prevent either of them from financial trouble after everything is final.

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Lorrie J. Zahodnic

"I will hold you up until you can stand on your own two feet."

Lorrie J. Zahodnic, P.C. has provided skilled and compassionate legal guidance to Michiganders in family law matters for over 20 years.

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