How Will an Illinois Divorce Affect My Credit Score?

 Posted on January 22, 2025 in Property Division

Divorce can be challenging, and its consequences may seem to keep cropping up long after the divorce is over. Financial concerns are the most likely long-term consequences of a divorce. One of these financial consequences is finding out months after the divorce that your credit score has taken a substantial hit. To be clear, your divorce, in and of itself, will not cause your credit score to drop, but the financial actions taken during and after a divorce may.

Further, if your spouse was buying things on credit that you were unaware of, your credit score will reflect these actions no matter whether you had anything to do with those purchases. Having an experienced Will County, IL family law attorney who acts as your advocate throughout and after the divorce can minimize some of the adverse consequences.

How Can a Divorce Impact Credit Scores?  

Marital debts, just like marital assets, are subject to an equitable split during a divorce. Even when a debt is assigned to one spouse, if the other’s name remains on the loan or account after the divorce, that spouse could be held liable for non-payment. If one spouse misses payments or increases credit usage, those actions could be reflected in the other spouse’s credit score and report. While it hardly seems fair, it is extremely important that steps are taken to document any actions on the part of an ex that could damage the other’s credit.  

How To Protect a Credit Score After Divorce

There are certain steps that can be taken following a divorce that will help protect each spouse’s credit score. These include:

• Pull a credit report prior to the divorce and make note of the credit score and the items on the report.
• After the divorce, review this credit report on a regular basis – at least every six months.
•  If joint accounts remain open, these accounts should be closed by both spouses, and any balance transferred to an individual account in the name of only one of the spouses.
• Work within a budget after the divorce. This budget should reflect each spouse's new financial reality while meeting all debt obligations.
•  If there are joint debts, settle these debts during the divorce to avoid any future problems.

What if One Spouse Fails to Pay a Joint Debt Assigned to Him or Her During the Divorce?

When one spouse fails to pay an assigned debt, the other can be held responsible if his or her name remains on the account. Every Divorce Decree should include clear provisions regarding which spouse is responsible for each debt.

It should also include agreed-upon decisions for dealing with joint debts. Consolidating a debt or refinancing the debt in one spouse’s name can eliminate liability for the other. If one spouse does not abide by the language in the Divorce Decree, enforcement can be sought through the courts.

What Are the Best Ways to Rebuild Credit Following a Divorce?

It can be tough to restore credit to a positive place after a divorce. The best ways to do so include always paying every bill on time. Late payments can significantly decrease credit scores. Keep credit card purchases below 30 percent of the stated credit limit. For instance, if one credit card has a $3,000 limit, never let the balance owed go over $900. Manage existing accounts responsibly rather than opening a flurry of new accounts. Consider speaking to a credit counselor or financial planner who can detail a workable plan for long-term financial stability.

Contact a DuPage County, IL Divorce Lawyer

Getting divorced is rarely simple or emotionally easy. Even so, the landmines you may encounter in your divorce do not have to negatively impact your financial future for decades to come. Speaking to a Naperville, IL divorce attorney from Law Office of Ronald L. Hendrix, P.C. can make a significant difference in the outcome of your divorce. Attorney Hendrix uses his master’s degrees in counseling and guidance, along with his law degree, to help his clients get a fresh start and a hope-filled future. Call 630-355-7776 to schedule your free consultation.