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If you're going through a divorce, there's a good chance that your spouse or you could miss a bill payment along the way and your credit score takes a turn for the worse. The unfortunate result of a damaged credit score is that you typically pay higher interest rates for years to come.

Furthermore, a growing list of organizations may request to see your score, including your prospective employer, mortgage bank, insurance company, rental car company, landlord and student loan organization to name a few.

So you really need to be aware of your finances before, during and after your divorce, and take the appropriate steps to ensure your own financial health and credit rating.

Here are some useful tips on how to manage and/or repair your credit.

Ways to establish credit:

• Open a bank account. This helps prove financial responsibility.
• If you have a steady income, apply for credit with a store or business. 
• Ask a family member or friend with a good credit rating to co-sign a credit  application for a small amount if you don't feel comfortable asking for more. After using the credit account responsibly for one year, you can apply for credit on your own.

What your credit score means:

• Credit scores measure what sort of a credit risk you are. 
• They take into account a number of variables including your payment history and amount you borrow in relation to your credit line.
• This information is summarized as a number on a scale of 300 to 850, with 300 the worst and 850 the best. (For more information, go to
• A good score is in the mid-700s although the average is closer to 650.
• The higher your credit score, the less you can expect to pay on a loan from mortgage rates to interest rates on your credit cards.

What determines your credit score:

• Payment history/delinquencies — 35%.
• Amounts owed/proportions of credit lines used — 30%.
• Length of credit history — 15%.
• New credit, including number of recently opened accounts, number of recent credit inquiries and re-establishment of positive credit history — 10%.
• Credit mix or types of credit you use (e.g. mortgage, credit cards, car loans etc.) — 10%.

How to improve your credit score:

• Check to see if there are inaccuracies on your credit report.
• Send a letter of correction to credit agencies if you find an error.
• Pay your bills on time even if you can only afford a minimum payment.
• Pay down your credit card balances. 
• Take note of the interest rate you're paying. As the credit card company if it can reduce your rate.
• Use inactive credit cards, but only if you can pay them in full.
• Improve your "mix" of debt. Change your home equity line into fixed monthly payments.

How can to get a free copy of your credit report:

• You can get one free credit report a year from each of the credit bureaus: Experian, Equifax and Trans Union. Go to


Click the following for more resource articles on Your Finances and Divorce

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