How to Manage Debt from Divorce What You Should Know

While divorce is a challenging emotional experience, it can become even more complicated when it comes with significant financial implications as well. One of the most common issues that couples face when confronting their separation is managing their debt. Many couples find themselves discussing the management of credit card balances, joint loans, and mortgages that they share together while living together in Florida. When communicating about these financial obligations, you can start to feel overwhelmed, especially when navigating the emotional rollercoaster of a divorce. Knowing how to handle your shared debt during the process of divorce is critical. Here is what you should know.

• Make a List of Your Shared Debt to Review Your Financial Situation Properly

Sitting down and compiling a list of your shared debt can make it easier to tackle. There are many types of debt that a married couple can have, such as the following: 

• Mortgages
• Auto loans
• Credit card balances
• Student loans
• Personal loans

Another important task to remember is to note if any of these debts are in one spouse’s name or if both spouses are cosigners. This is crucial because it will determine who is responsible for the debt after the divorce.

• Identify Debt and Who Is Responsible

While this next point can be tricky, it’s important to review your list of shared debt and to determine who is responsible. During your divorce in Florida, it’s a good idea to consult with an attorney to specify who is responsible for certain debts. You will want to make sure that your debts are put into one person’s name in case a creditor comes to request money from both of you after your divorce, even if your divorce decree states one party is responsible. This will help to make your divorce a smoother process when it comes to your finances.

• Find Ways to Improve Your Credit

By preparing ways to improve your credit, you can save yourself from a lot of headaches after your divorce. After your divorce is finalized and your debts are settled, you can focus on rebuilding your credit. You can improve your financial standing in the following ways:

• Check your credit reports. Contrary to popular belief, checking your credit score won’t hurt it.
• Make timely payments. This will positively impact your credit score.
• Apply for a secured credit card. This is a great way to rebuild your credit if it has been negatively impacted by your divorce. 

• Seek the Help of a Professional

Another great way to manage your debt after a divorce is to consult a professional, such as a financial planner or a divorce attorney. That way, you can create a budget, prioritize debt repayment, and gain insight into strategies to improve your credit. A divorce attorney can help you through the legal process of dividing debt.

Divorce is never easy. There are many factors that need to be addressed, and the financial implications should never be ignored. If you are concerned about the well-being of your financial state after a divorce, these four tips will help.