Q: I am a 34-year-old single parent who is trying to reestablish herself and her credit after going through a divorce. What type of advice and solutions can you give me? I am currently working a full- and part-time job trying to make ends meet.
A: Unfortunately, any delinquencies on debt attached to your name, even if the debt belonged to your husband, will adversely affect your credit rating. According to Durant Abernethy, president and CEO of the National Foundation for Credit Counseling (800-388-2227; www.nfcc.org), if there is a divorce decree, you should contact your creditors and the three major credit bureaus–Equifax (800-685-1111), Experian (888-397-3742), and TransUnion (800-916-8800)–and make them aware that you are divorced. Some creditors may ask for a copy of the divorce papers. “It will have a minimal effect,” he explains, “though it could influence a new creditor’s decision to grant you credit, if he chose to acknowledge it.” It will not, however, erase any blemishes.
Understand that there are no quick fixes for tarnished credit. The only way to repair it is to reestablish responsible use of credit. Apply for a major, unsecured credit card, if you can get it. If not, get a secured credit card and use it as regularly as you can afford. Make sure you make your rent or mortgage payments on time. If you need transportation–and can afford it–he suggests buying a new or used car through a low-interest-rate promotion (0.9% or 0%).(See “Credit busters,” this issue, for tips on reestablishing your credit.) “If you think you are going to miss a payment, call your creditor immediately,” urges Abernethy. “Let them know the situation and see if you can work out an agreement.”