On behalf of Kelly Law Office, LLC posted in high-asset divorce on Wednesday, May 8, 2019.
Ohio couples know how stressful a divorce can be, especially when children are involved. Many life-changing decisions have to be made during a relatively short period of time. Typical issues to resolve include child custody, child support, alimony and the division of property. What some spouses may not realize, however, is that decisions made during a divorce can affect a credit score.
To be clear, simply getting a divorce does not directly impact a person’s credit. However, creditors and collection agencies may not honor the dissolution of joint accounts as spelled out in a divorce decree. Because of this, a credit agency might attempt to collect late payments from both spouses on a loan that was made jointly even though the divorce decree specifies just one spouse is responsible for future payments. If an ex-spouse ignores a judge’s order to make payments, the other spouse’s personal credit score could suffer.
Another concern is that an ex-wife’s credit score could suffer disproportionately. Even though the Equal Credit Opportunity Act strictly prohibits discrimination based on gender, credit bureaus may lower an ex-wife’s credit score simply because women earn less than men on average. Recently divorced women also earn less than recently divorced men, according to the U.S. Census Bureau.
Taking steps to protect a credit score is especially important during a high-asset divorce where the couple jointly owns property, investment accounts, pensions and 401(k) retirement accounts. In order to achieve an equitable division of property and debt, a soon-to-be ex could enlist the services of a family law attorney.