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Pay attention to credit during and after a divorce

The end of a marriage marks a major transition in one's life and is the doorway into a new future. For many in Texas, a primary concern during a divorce is the financial ramifications that will result. One of the best ways to ensure a stable financial future is to address credit matters in the early stages of divorce.

The first step in credit management is to gather full reports from all three credit bureaus. With those documents in hand, spouses must check carefully for errors and omissions. Any information that is incorrect, outdated or missing can be reported, and each bureau has a system in place to allow individuals to challenge information held within the report.

Next, spouses should take steps to open one or two new accounts in their own name. By making responsible use of credit and paying each payment on time, a positive credit history can be quickly established. Spouses should research new credit offers carefully, and only open accounts that offer low interest rates and no significant fees.

It is also important to monitor accounts that are held in the name of both spouses. If there is any indication that one's soon-to-be ex might run up debt before the divorce is made final, joint accounts should be frozen so that neither party can add to the existing balance owed. In most cases, joint accounts cannot be augmented to reflect only one responsible party unless the account balance is paid in full. Responsibility for joint accounts is negotiated within the property division process.

By taking these tips to heart, Texas spouses can make strides toward improving their credit even before their divorce is made final. This can give individuals a jump start on creating a credit history as an individual, rather than relying on a joint account to establish credit standing. Having a solid credit rating can make it easier to access credit when needed, which can be important in the years following the end of a marriage.

Source: moneytalksnews.com, "10 Financial Moves That Keep You Sane During a Divorce", Marilyn Lewis, July 23, 2015

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