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Breaking up is hard to do, especially those splits that lead to acrimony, bitterness, and financial hardships when a former partner tries to destroy your credit. That's why, among other, more emotional issues, taking good care of your finances is imperative once you even start thinking of leaving a relationship. "It's before, during, and immediately after a divorce that you can do the best job limiting any damage an ex can do to your credit," says Michael M. Giel, a family law attorney with Giel Family law, P.A., in Jacksonville, Fla. (See also: When Divorce Does Damage to Your Credit)
A credit protection action plan
If you're planning on a divorce or break-up, wall off your money,—and your credit—with these seven steps. And, the sooner the better:
Get legal help
Check with your attorney to see how joint accounts should be handled. "For instance, in Florida, you can get into trouble if you unilaterally start dumping your soon-to-be ex off joint accounts," Giel notes. "Standing family law orders generally prohibit parties from changing the status quo, and you may face sanctions and an angry judge if you jump the gun."
A good attorney can talk to the ex-partner's attorney about intermediate steps or consent orders that address the joint accounts issue, Giel says. "That can limit the damage each partner can do to the other's credit during the divorce."
Get your credit report right away
This is a quick, but highly effective way of noting that an ex-spouse put you on his or her credit accounts without your knowledge. "Check them as soon as possible and keep checking them after the divorce or break-up," Giel states. "It's a good practice to prevent any problems or errors with your credit, especially from identity theft—whether caused by your ex or someone else—or by your ex's failure to timely pay any joint debts that the court orders him or her to pay."
While credit scores don't combine when you get married, if you share joint accounts then a loan or card with both your names on it could impact you and your credit.
Close joint accounts and credit cards as quickly as possible
If your state's laws allow it, remove your ex-partner or spouse or yourself from any joint financial accounts, says Jennifer Beeston, a loan originator at Guaranteed Rate Mortgage, in Santa Rosa, Cal. "Realistically I would close any joint accounts as soon as you can," she explains. "In my experience, I've heard of ex's writing checks as their ex-spouse or partner, even after they're off the account. To be extra safe, start a new account in your name only and close joint accounts."
Beeston strongly advises individuals who share a credit card with an ex-spouse or partner to act quickly and get them off the card account. "If they're an authorized user on your credit card, call the credit card company and remove them as soon as possible," she advises. "Also, have your credit card number changed and a new card to you issued right away."
The opposite is true, as well, when it comes to guarding your credit health. "If you're an authorized user on their account, have your ex-partner remove you quickly and give them back any credit card you're holding," Beeston says.
Act fast on passwords
Change all passwords on credit card accounts and bank accounts, adds Beeston. "Even if they were never on those accounts, an ex-spouse or partner may have your passwords," she notes.
Share a mortgage? Then set a date
If your ex-spouse or partner will be keeping the jointly-owned house, take direct action. "Set a time frame when he or she should get a new mortgage in their name only and attach consequences if it doesn't happen in that time frame," says Patricia Stallworth, a money coach and the author of How to Get Divorced Without Losing Your Blouse.
"There's a bottom line with home ownership," Stallworth says. "You have to be diligent and you can't leave something this important to chance."
Freeze your credit
If your ex-spouse or partner is really out to get you financially, one of the best ways to protect your credit is to freeze it, says Scott W. Johnson, owner of WholevsTermLifeInsurance.com. "Freeze your credit as soon as possible and lock your secret code away where they won't find it," he says.
Contact the credit bureaus right away to freeze your account. To freeze your Experian credit file, visit www.experian.com/freeze or call 1-888 EXPERIAN (1-888-397-3742), then enter your identification information and PIN.
Square away auto ownership
Legal judgments generally divvy up the vehicles between the two of you. "For those vehicles bought during the marriage, your name might be on the title," Giel says. "And if your ex gets a car and doesn't take the proper steps to have your name removed from the title, it can remain there."
That's a problem. In some states, including Florida, if your ex causes an accident months or years later, and your name is still on the title, you may be sued for damages and have your credit ruined by a judgment. "Ensure there's a provision requiring your ex to retitle the car in his or her name alone," Giel advises. "Include in the provision a procedure for follow up and enforcement."
Then, follow up. If you don't, and your name is still on the title when an accident happens, you could still be nailed for damages that far exceed insurance coverage.
Don't take your credit for granted in a split-up
Nobody looks forward to a relationship split—before, during or after. If you do go that route, take care of yourself emotionally, spiritually—and financially.
"It would be great if people could break up nicely and not running each other financially," says Beeston. "Unfortunately, to protect yourself and your financial future, if you break up with a spouse or partner, then you need to break up your finances, too."