Protecting Credit During Divorce & Mortgage Rate Update

By
Mortgage and Lending

Chances are you know someone who is facing the challenges of divorce. Going through this process can be emotionally and financially difficult. Failing to address important credit issues, however, will only make things worse. Remember, a divorce decree does not absolve credit contracts or relieve responsibility for any and all debt incurred during the marriage. The following is a proactive plan to maintain healthy credit both during and after a divorce.

Know Your Credit - Obtain copies of credit reports from all three bureaus right away (Experian®, Equifax, and TransUnion®).

Organize The Facts - Make a list of ALL open accounts and create a spreadsheet with creditors' contact info, account number, type of account, balance, monthly payment, and the name of the vested spouse.

Take Action - Sell or refinance secured credit assets (e.g. car, house, etc.) if possible, ensuring that loans are either paid in full or that only the vested spouse's name remains attached to the account. Immediately close any unsecured accounts (e.g. credit cards, etc.) with no balance. For those accounts with a balance, have them frozen to ensure no future charges can be made.

A Few More Tips - Only a creditor can change the terms of a credit contract. A judge may order one spouse to pay off a joint account, but both parties are still responsible in the eyes of the creditor if the debt is unpaid. If possible, pay off these accounts quickly to help maintain good credit. However, if one party is ordered to pay off the debt of an open joint account, that party should be sure that the title reflects this change to avoid paying for something he or she no longer owns.

Mortgage Interest Rates*
Rates as of Friday, 3rd April, 2009:
  Conforming APR Payment per
$1,000
Jumbo APR Payment per
$1,000
30-Yr. fixed 4.875% 5.005% $5.29 5.625% 5.716% $5.76
15-Yr. fixed 4.500% 4.723% $7.65 5.000% 5.151% $7.91
7-Yr. fixed ARM 5.125% 5.257% $5.44 5.125% 5.213% $5.44
5-Yr. fixed ARM 4.750% 4.879% $5.22 4.875% 4.962% $5.29
3-Yr. fixed ARM 4.750% 4.879% $5.22 4.875% 4.962% $5.29
5-Yr. Interest Only 5.000% 5.131% $4.17 5.125% 5.213% $4.27
*Rates are subject to change due to market fluctuations and borrower's eligibility.
Superior Home Mortgage Corp. licensed in DE, FL, GA: Georgia Residential Mortgage Licensee #14511, MD, MI, NY: Licensed Mortgage Banker - NY State Banking Department, NC, PA, SC, VA: Virginia State Corporation Commission License # MLB-566, & DC. Superior Mortgage Corp. licensed in CT, MA: Mortgage Lender License # MC3208, NJ: Licensed Mortgage Banker - NJ Department of Banking, RI: Rhode Island Licensed Lender & Broker, & TN. SHM Mortgage Licensed by the New Hampshire Banking Department
close

This entry hasn't been re-blogged:

Re-Blogged By Re-Blogged At
Topic:
Mortgage / Finance
Location:
New Jersey Atlantic County Hammonton
Groups:
Realtors®
1st Time Buyers
New Jersey Real Estate Experts
Addicted to Active Rain
FREEDOM Office: Professionals Working from Home
Tags:
interest rates
credit
rates
mortgage rates
credit advice
credit protection
credit tips
mortgage rate update

Post a Comment
Spam prevention
Spam prevention
Show All Comments
Rainmaker
472,455
Janice Roosevelt
Keller Williams Brandywine Valley - West Chester, PA
OICP ABR, ePRO,Ecobroker

After finally getting signautres on an agreement for the sale of a house (after 9 months on the market)  where the owners are going through a divorce, I ca echo the importance of everything here. Thanks for the post, Karl

Apr 03, 2009 11:31 PM #1
Rainer
29,656
Jay Williams
Greenville, NC - Greenville, NC
Mortgage Loan Officer - Getting You The Right Loan

Karl, it amazes me that so few divorce attorney's give advice or direct their clients professionals for advice on this subject. In particular getting your name of debt for which a divorce decree indicates the other party is responsible to pay.

Jay

Apr 04, 2009 02:54 AM #2
Rainer
108,048
Karl Peidl
Moorestown, NJ
Accredited Loan Consultant

Janice - Working with sellers that are going through a divorce can be especially difficult as there is usually so much more emotion involved.

Apr 06, 2009 05:21 AM #3
Rainer
108,048
Karl Peidl
Moorestown, NJ
Accredited Loan Consultant

Jay - I completely agree, particularly when I hear so many clients say that divorce is what ruined their credit.

Apr 06, 2009 05:26 AM #4
Post a Comment
Spam prevention
Show All Comments

What's the reason you're reporting this blog entry?

Are you sure you want to report this blog entry as spam?

Rainer
108,048

Karl Peidl

Accredited Loan Consultant
Ask me a question
*
*
*
*
Spam prevention

Additional Information