07-27-2010 09:54 AM
Okay here is my situation. I have made the decision to divorce my husband and I need to know the best way to proceed to protect my credit score – and my husbands. I have a plan in place but the thing is that I cannot let my husband know what I am planning. I have no intention of screwing him over or anything but if I tell him, he will run out, get a divorce now, stop paying for everything, and we will both be ruined financially and credit wise. I’m in a mentally abusive situation and need to get out – that’s why I can’t tell him. I know from experience that he will just stop paying like he did during his last divorce. I can’t afford for this to happen. And I’m waiting for the housing market to go up so that we aren’t under when we sell the house. Hopefully we can both walk away with clean credit and no debt – if I can pull this off my way.
History: Both our credit scores were in the toilet about 6 years ago. I’ve worked hard since then to get our credit spotless – mine is except for one ding that will fall off next year, and he has 3 that will fall off next year. Other than that, we have 6 years of spotless history. The only drawback is.. about 3 years ago, I was finally able to obtain credit cards again, and I went overboard. I have about 15 different cards, all store cards except for one MC, one Discover, and one Visa. None of them have high credit limits – they range from $400 to $1500. Right now, most of them are maxed out, but I’m working on that.
My main question is this. Once I am divorced I know that getting a loan for a house or anything else is based on my salary alone. I know that I should never close a credit card once it’s opened unless they charge a yearly fee – none of mine do. How would I go about making sure that I don’t have too much “available credit” with the cards I have that goes against my yearly pay? Is there a scale that tells you what amount is best or what not to exceed? And how should I go about lowering my credit limits? I won’t request a decrease that is below what I owe of course, I just don’t want my credit score to plunge – it’s in the high 600’s. I am thinking the divorce will begin next year, probably around the summer time so I have about a year to play with to achieve my goals.
I hope this made sense. I just need some guidance and I hope someone can help me.
07-27-2010 01:12 PM
Hi, welcome to the forums! Sorry to hear about the rough times, but it looks like you're taking care of yourself. And thumbs up for trying to do right by both of you.
Don't worry about the "too much available credit" thing. I don't even know if mortgage lenders still carp about that. It never was all that common, from what I understand. But at any rate, that's in the future, and for now, your credit profile will benefit from keeping them open, zeroing out the balances, and keeping healthy tradelines reporting, thus building up your credit profile. Of course, if you find that despite your best intentions, you're running the balances back up, that's different. But that's a separate issue from a maybe-it-will-happen-maybe-not reaction by a future lender.
If any of the CC's are joint, you'll definitely need to close them, probably the sooner the better, if you can do so. Otherwise, make sure that the balances stay paid off and be prepared to close them the day that you tell him that you want a divorce. In fact, maybe make the phone calls right before you tell him. It's pretty shocking how vindictive some people can be.
When the time comes for you to get a mortgage, if you are told by your lender that you do have too much available credit, you can analyze your CC's at that point and decide whether to close any. I've seen posts in the past where members told their CCC's the situation, and the lenders let them close the card during the application process and then reinstated them afterwards. That's a bit shaky ethically, and I don't know that any lenders would that nowadays. Just an fyi. But the "too much credit" bugaboo is often just something that you read by journalists who haven't necessarily done any real research on the matter, and who are just repeating things that they once read.
Otherwise, just keep going with your plan. And make sure that you stay competitive in the workplace, getting any extra training that might help you advance or at least protect your job. Draw up a personal budget and learn to stick to it. Maintain your physical and mental and spiritual health. Just keep focused on doing the right thing and expect some bumps along the way. I hope it works out for you.
07-27-2010 01:43 PM
Thank you so much for your detailed response. I will have all of both our cards paid to $0 by next spring. The only thing we will owe is for our vehicles and house. I figure we sell the house, he pays for his, I pay for mine. We do not have any joint credit cards, but we are authorized user on a couple of each others but i know how to remedy that.
There's not much I can do to advance with my current job or get any training, but I will be moving back to my home state when this is done. I will wait and go back to college there so I don't end up paying out of state tuition.
Thank you again.