19 Things to do before you apply for a credit card after divorce

Kim Finkle, MBA, Financial Advisor

The use of existing credit cards during and after divorce can have serious financial implications. In many cases, a divorce decree will state who is responsible for paying the shared credit card debt. If both parties will remain liable, then it’s important to close the account once the divorce is finalized in order to protect each party from further liability. Additionally, both parties should contact the creditor to ensure that no further charges are made on the account after the divorce decree is entered.

In some states, the court may issue a standing order preventing either party from using shared credit cards after the divorce. This order may specify that either the cardholder must close the card and may not reopen the account or that only one party has authority to use the credit card. If a standing order has been issued, then it’s important that each party adhere to the court’s orders.

After the divorce, both parties may want to open separate credit cards. This can help to rebuild credit and provide some financial security. However, it’s important to be aware of any remaining financial obligations related to the original shared credit cards. These obligations can often carry over regardless of who is the account holder, so it’s best to be aware of the status of any such accounts with a credit check.

19 Things to do before you apply for a credit card after divorce

Getting a credit card after divorce can be difficult. Depending on the individual's financial situation, it may be necessary to apply for a secured credit card. A secured credit card requires a cash deposit and generally has a small credit limit. Other options include applying for a retail store credit card, a gas station credit card, or an unsecured credit card with a low credit limit. It may be necessary to work to rebuild credit and improve the creditworthiness of an individual before they can qualify for a regular credit card.

Tips for successfully getting a new credit card after divorce

Review your credit reports for accuracy and dispute any errors.
Pay off existing debt and create a budget that allows for consistent payments.
Know what type of card is best for you - cash back, points, airline miles, etc.
Save up an emergency fund BEFORE applying for a new card.
Know your numbers -- be familiar with your credit score, income, and debt-to-income ratio.
Understand the interest rates and annual fees associated with the card you plan on applying for.
Check online reviews to make sure the credit card company is reputable.
Determine the benefits the card offers and ask questions you have prior to applying.
Make sure the terms and conditions of the card are correct and up to date.
Look at the type of rewards, if any, offered by the credit card.
Read through any clauses and fine print carefully so you know all the details of getting the card and using it.
Check to see if there are any annual fees for using the card.
Only apply for one credit card at a time.
Set realistic spending limits and stick to them.
Make sure the credit limit is not too high for amounts you can easily afford to pay back.
Ask about sign up bonuses for new accounts.
Research how long it takes for the credit card company to report to the three major credit bureaus.
Be aware of the fraud protection and security measures in place with the card.
Watch for offers that waive the annual fee or offer lower interest rates.

Useful tips for getting additional credit cards

Track your spending and payments to ensure they are within the credit limit.
Monitor your credit card account online and review monthly or quarterly statements.
Take advantage of cash back or reward programs available through the card.
Take advantage of online bill paying options offered by the credit card company.
Make sure payments are made at least 5-10 days before the due date.
Keep financial information about your credit card secure and protected.
After using the existing card for 12 months and keeping a good credit history, you can apply for another credit card.

Does divorce hurt your credit?

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Can you run a credit check on your ex?

What to do with a bank account during and after divorce?

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What to know about money after getting a divorce

How to create a budget?

How to get a bank account after divorce?

Warning: This post is neither financial, health, legal, or personal advice nor a substitute for the advice offered by a professional. These are serious matters, and the help of a professional is recommended as it can impact your future.

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19 Things to do before you apply for a credit card after divorce

Tips for successfully getting a new credit card after divorce

Useful tips for getting additional credit cards

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