What Happens to Credit When You Get Divorced?

Divorce, regardless of how easy or difficult the process is, usually affects both your credit and your spouse's. While your divorce isn't directly listed on your credit report, the effects of splitting up property and debts typically impact your credit one way or another. You should talk to a qualified attorney in your area if you need legal advice about divorce and the potential impact it has on your credit.

Credit Reports

When you and your spouse got married, you each had individual credit reports that detailed your pasts as credit users. You maintain these individual reports as a married couple, but you likely incurred joint debts that affected both you and your spouse's reports. Any individual accounts that either of you are maintained as individual accounts and do not appear on your spouse's report either before, during or after your marriage.

Divorce

Once you get a divorce, you and your spouse have to split up all your property, including debts or obligations. The court will split this for you if you cannot come to an agreement, but the terms you agree to can affect your credit. The divorce doesn't change the terms of your debts, as the creditor is not a party to your divorce. Your divorce assigns responsibilities for debts, but it is up to you to ensure you and your former spouse to take care of joint obligations.

Joint Accounts

Married couples often share accounts, such as bank accounts, mortgages or credit cards. When you divorce, it is in your best interest to ensure these accounts are properly separated so your former spouse's actions cannot affect your credit. For example, couples typically cancel joint credit card accounts in a divorce. In other situations, such as where a wife is the account holder and the husband is an authorized user, the wife only has to cancel the husband's rights to use the card instead of canceling the entire account.

Credit Score Impact

Credit scores are based on several factors indicated by your credit report, including the average length of all your credit instruments, the amount of available credit you use and the variety of credit you have. If, for example, you and your wife agree to cancel a joint credit card that you've had for a long time, your score may go down. On the other hand, if you accept a settlement payment from your spouse that you then use to pay off a credit card debt, your score may increase.