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How going through a divorce can affect credit

While filing for divorce in Maryland will not automatically cause credit scores to fall, the separation process can make it more difficult for exes to borrow in the future. Divorce can affect credit in several ways, but many of the negative consequences may be avoided if spouses make decisions based on sound advice and are realistic about their financial situations.

Untangling the financial affairs of couples who have been married for many years can sometimes be difficult. This is especially true when large amounts of debt have been taken on to pay for assets. Before discussions begin over property division, spouses should run credit reports to ensure that all debt is accounted for. Refinancing will generally be necessary when spouses receive assets that are financed jointly, such as a primary residence. If an account falls into arrears, lenders will not be swayed by divorce agreements. They will generally pursue any individual who signed the loan papers.

Dealing with financial issues can be even thornier during contentious divorces. When negotiations become hostile and an amicable resolution seems out of reach, spouses may be wise to limit access to financial accounts and not assume that long-standing financial arrangements will be honored as they have been in the past.

Family law attorneys may discuss the financial consequences of divorce at length with their clients. For example, spousal support is sometimes withheld or paid late when resentment lingers. However, attorneys may suggest that their clients be more aggressive during negotiations over asset division when alimony is unlikely to be paid promptly. Attorneys could also suggest caution during spousal support discussions when spouses have unreliable sources of income or work in industries that are transitory.

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