Are you getting ready to go through a divorce and worried about how it might affect your
credit?
By the end of this video, you're going to understand exactly what you need to do to
protect yourself and your credit in the event of a divorce.
Hi, I'm Rebecca Zung, top 1% attorney and the bestselling author of the books, Negotiate
Like You Matter and Breaking Free: A Step-by-Step Divorce Guide.
I've helped thousands of people just like you go from lives of drama, trauma, chaos,
and helped them along to step into lives of freedom, possibility, and purpose.
And I do the same thing for you right here on this channel and in these videos.
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So let's talk about how to protect your credit in a divorce.
Divorce is actually one of the biggest financial transactions that you'll ever make in your
life.
I mean, what's more personal than dealing with your own personal finances? when you're
dealing with financial aspects of divorce, you're dealing with not only your bank accounts,
but your retirement accounts, your credit cards, your business potentially, if you own
a business, or maybe even more than one and the biggest assets in your life, which is
for a lot of people, your house and maybe even cars or college funds, assets, your jewelry.
all of these things are looked at in a divorce.
But when you're dealing with how to protect your credit in divorce, there are a number
of different things that you're going to want to look at.
Number one is actually what you're going to do with the house.
If you own a house together and there is a mortgage on that home, I highly do not recommend
one person retaining the asset and both parties staying on the mortgage.
Because now you have no protection, especially if you're the one who's not supposed to be
making the payment.
A lot of times people will say, "Okay, I'll put language in the agreement that says that
one person's going to make the payments, and if that person doesn't make the payments,
then the other person has to be indemnified or they hold the other person harmless or
something like that.
But here's the thing that people don't realize, and that is that the bank, the mortgage company,
whoever the entity is that holds that mortgage still thinks that you're both accountable.
They still want both pockets there available for them to go after if somebody defaults
on the mortgage.
So how that plays out in divorce court in reality is let's say, it's the wife who is
supposed to make the payments.
Wife doesn't make payments, now bank goes after both of you.
Husband goes, "Hey, but I, I'm not supposed to make the payment, see, here's the agreement."
Bank goes, "Well, too bad.
You still have to make the payments.
If you want to protect your credit, then you're going to have to make the payments and catch
me all back up or catch the bank all back up."
And then what your recourse is, is to go back to divorce court, file a motion for contempt
or a motion to enforce, and now go set that for hearing and then go to the court and go
to the judge and say, "Look, Judge, here's our agreement.
She supposed to pay."
And then you have to wait for the judge to make a decision.
Now, meanwhile, you have to incur fees for all of that.
And it can take time because a lot of courts are backlogged.
So the reality of that is if payments get missed, the person who's name is still on
that mortgage is screwed if they don't have some kind of protection.
So the best way to do that if there's a house and one person is retaining the house, the
person who's retaining the house also should refinance that mortgage.
That's one way to definitely protect your credit in divorce.
The next thing that you're going to want to do is make sure that all joint credit cards
are closed and paid off and closed.
You don't want to retain your name on a joint credit card at all.
Yes, you do get dinged a little bit if you close a credit card but you really don't want
to leave your name out there.
Because even if you pay it all off in the settlement, if the other person goes back
and charges a ton of stuff on it and now that card is open, and again, just like with the
mortgage company, the bank goes, "Well, both names are on it.
I want to keep as many pockets open as possible."
So now the bank is going to go back and want both names to be available to go after.
So if you want to make sure that you're protected in your divorce, give me a protect me in the
comments right now.
The next thing that you can do is make sure that you do the same thing for any kind of
car payments or any kind of loan.
If your name is still on it and the other person is retaining it, then that loan needs
to be refinanced.
So that the person who's retaining it, that's the only person whose name is on it.
If that person can't afford, for example, to keep the home because they can't afford
the mortgage, then they don't get to keep it, then it has to be old.
Or maybe you're the one who retains it if you're the one who is the moneyed spouse.
So making sure that you're refinancing whatever you need to refinance.
The last thing that you want to do is make sure that you check your credit on a regular
basis during the divorce and even after the divorce.
Because things like divorce don't show up on credit cards...
I mean, on credit statements, like credit reports, TransUnion, and all those types of
services.
They don't know that you got divorced.
Your divorce decree or your final judgment doesn't show up on a credit report.
So as far as the credit reporting agencies are concerned, it's just life goes on as if
it's been going on.
So remember that that person who you were once married to has very important information
such as your social security number, your date of birth, they know your mother's maiden
name, they know the name of your first pet and all of these things.
So you want to make sure that you periodically are checking your credit maybe three months,
six months, or even a year after you got divorced to make sure that nothing was opened in your
name without your permission.
And if you are getting ready to divorce a narcissist, make sure that you check out my
video on Before You Leave a Narcissist, Watch This.
And if you are getting ready to negotiate with a narcissist, make sure to grab my free
Crush My Negotiation prep worksheet.
You can get it at winmynegotiation.com.
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comment to let me know that you were here.
if you want more support or you're dealing with a narcissist, come join me in my free
private Facebook group called Narcissist Negotiators With Rebecca Zung.
I'm so glad that you were.
Remember, today's a great day to start negotiating your best life.
I'll see you in the next video.