Divorce Doesn't Have To Ruin Your Credit Rating

In 1996, I divorced my married woman and with that divorcement came the normal dividing of property and assets. There also was the treatment regarding our credit card debt. We were married for 5 old age and used the credit cards as a couple, but the credit cards were in my name only. Sadly, it became my duty to pay for the huge debt that we had created together.

If you happen yourself in a state of affairs like this, you are not alone. Experts state there have been a 20 percent rise in bankruptcy filings, and it is estimated that a large portion of this is owed to divorce. But don't worry, if you happen yourself in this situation, you will have got respective options. One thing you could make is data file for bankruptcy. Statistics show that many people are doing just that. But you should cognize that if you take this option, a bad grade will remain on your credit report for 10 years. Another option would be to simply do the payments. But for many people, after going though a divorce, they happen that life on one income is a hard adjustment, and are forced to only do the minimum payments. That tin take what looks like a lifetime, to pay off your debts. For example, if you have got a debt of $25,000 and are paying an average interest rate of 18%, it would be thirty-two years before you paid off that debt! You could be paying for those purchases well up into your 60’s or 70's!

Another option is to seek out professional help. There are respective non-profit organizations that specialise in debt relief, and many people seek this type of aid after a divorce. Here’s how it works. For a small fee of around $14.00 per calendar month debt relief companies will analyse your credit card debt, living disbursals and income in order to determine what type of repayment construction would best work for you. They will then reach your creditors and work with them regarding interest rates, late fees, and payment amounts. Because credit card companies understand that divorcement is one of the leading causes for bankruptcy, they usually won't have got a problem workings with the credit repair company. After all, they make desire their money!

Non-profit agencies make not report credit counseling to credit bureaus, but most credit card companies do. You may see this as a negative thing, but many people don’t. Credit counseling can be explained a batch more easily than bankruptcy. And bankruptcy is often a deal plug for person trying to purchase a home, or even purchase a car.

While you are in credit counseling you will not be allowed to reserve or apply for a credit card, but for most people who happen themselves in this situation, that tin be a relief. Think about that as you are cutting them up into small peices. I cognize I did. And with each ball of plastic that drop in the trash, it was a chipping away of the old and a birth of the new. There’s A feeling of relief that come ups over you when you cognize you don’t have got to worry about those mounting credit card bills. And when you are going through a divorce, the more than relief you can get, the better.