Divorce and its effect on a credit rating

Some former spouses in California may find that divorce can impact credit scores. There are many different ways this can happen. For example, if one spouse buys out the other’s stake in the family home, they may need to refinance. This can leave a person with a great deal of debt.

Some issues with credit happen because one person deliberately tries to harm the other spouse. For example, a soon-to-be ex might run up debt in the other person’s name and fail to disclose that. This can be easier for a person to do if the couple has not separated their joint accounts. The couple might also agree to divide a debt, but if one person does not pay, it could also hurt the other’s credit. If spouses are not communicating effectively, they might miss paying bills even though neither means to cause a problem.

In other cases, credit problems could arise despite the best efforts of both spouses. For example, one person or both might not understand what they are supposed to pay based on the divorce decree. It might simply be a struggle living on a single income. Creditors could review a divorcee’s record and reduce credit limits based on that. Debts could be split unevenly and make it difficult for one ex to keep up with payments.

In California, a community property state, most marital property is divided evenly. This could mean, for example, that one person might end up paying a portion of an ex-spouse’s debts. A family law attorney could provide valuable legal guidance during the property division process.