First, you are ending a relationship with someone that you loved or at least cared about at one point. Second, you have to figure out who gets to keep what and who will be responsible for joint debts and child custody. Finally, your credit could take a nosedive. What are some of the financial issues that you should consider before going through with a divorce?
Your Name Could Still Be on a Loan
Although a judge could order your ex-spouse to pay for certain debt such as a credit card or a mortgage; your name is still going to be on that loan. This means that you could suffer credit wise if your former spouse does not pay off that debt in a timely manner. While you can go back to court to enforce a judge’s order to have that debt paid off, it won’t help fix your credit or get the item erased from your credit report.
Loans Can Be Harder to Get When Your Credit Is Lower
A car or home loans could be difficult to get if you have recently gone through a divorce. This is because your credit score may be lower and due to the instability in your life. Lenders may be wary to see that you are going through the turmoil that a divorce can bring. Therefore, it may make you a higher risk to the lender and have to pay a higher interest rate and other fees for the loan.
Bad Credit Impacts You in Other Ways
Your poor credit could make it harder to get a job or pay a reasonable rate for car insurance. You may also have trouble finding an affordable apartment without getting a roommate. If you don’t have a job, you will have trouble paying your bills and may not be able to put any money in the bank to save for the future. This is a vicious cycle that could take months or years to get out of. When you first get your divorce, you may need to rely on money that you have in the bank or on secured credit cards that require a security deposit to open.
Are There Hidden Costs That You Need to Worry About?
You should consider any hidden costs that could come back to hurt you after a divorce. One example is any costs that are related to cancelling or switching motorcycle insurance companies. If you are given a motorcycle in the divorce, your first instinct may be to sell it if you don’t use it. However, you may still need to pay for insurance to keep it road legal or pay fees to cancel the policy outright if you don’t plan to use the bike, not to mention any legal fees that may be associated with an accident the motorcycle may have been in., for more information about attorneys that could help in this specific scenario visit Serious Accidents. Those costs could be in the hundreds or even thousands of dollars.
Divorce is never easy on a person both emotionally and financially. It may be a good idea to talk to an attorney prior to going through with the divorce to ensure that all of your bases are covered. Although it may not make the divorce any less expensive, at least you will know what you are in for ahead of time.