Getting Credit After Divorce or Separation


Getting a divorce may not only impact your personal life, but also make it difficult to obtain credit, just when you might need it most.



What are the financial burdens of a divorce?

Going through a divorce or separation can be extremely challenging, both emotionally and financially. According to a 2014 study by Aviva, the cost of divorce fees alone in 2014 were typically £1,280 per person – but there can be a wide range of other costs to consider, such as childcare and maintenance, lost savings, finding and furnishing a new home, or suddenly needing to pay your bills, mortgage or rent by yourself.


This page aims to provide useful information about the steps you can follow to help you through this difficult time.



How can a divorce affect your credit rating?

Break-ups can also have an impact on your credit rating, particularly if you had a joint bank account with your ex-partner. You may find that you are jointly liable for any loans, credit cards and other debts taken out jointly, even if only one party used them.



How to avoid bad credit after a divorce?

A divorce or break-up doesn't remove any joint liabilities for debts: in the eyes of creditors, you are still equally responsible for making sure they are dealt with. For this reason, it's sensible to settle any jointly-held debts as soon as possible and establish, if possible, who will pay for what.  If you have evidence that a debt taken out in both your names is solely the responsibility of your ex-partner, you can ask the creditor to transfer it to be in their name only.


Closing any shared accounts and credit cards will help you remove any financial connections you may have with you ex-partner. It is also possible to apply for a Notice of Correction to your credit report to clarify that you are no longer associated with your ex-partner, and if you are living at a new address, you can  also update the electoral roll to reflect this.However, please note that a Notice of Correction could affect your ability to obtain an instant response on your eligibility for credit, since all lenders take this into account when making their lending decision. 



Misconceptions about credit and divorce

There are a couple of common misconceptions about credit and divorce. One is that simply changing back to your unmarried name will remove any financial connection with your former partner – this isn't true, and you should contact lenders and credit bureaus individually to ensure their records are up to date.


Another misconception is that your ex-partner’s bad credit rating could affect yours. Your reports are separate, even if your name is still linked to theirs on your report. However, joint accounts create a financial connection with your partner and getting a divorce does not break the contractual agreements you have with your lenders, meaning that further debt can be added to those accounts. Settling the accounts or closing them to further charges may help you remove any financial connections to your ex-partner. Contacting the lenders to remove either one of you from responsibility from any open joint accounts will prevent your ex-spouse’s credit from affecting yours in the future.


It is also worth noting that if your ex-partner's name was on most of the bills you shared and other financial documents, it's possible that you won't have a credit history of your own. Just like a bad credit history, a blank credit history can be a bad sign for lenders, and can affect your chances of getting a mainstream loan or credit card.



Dealing with bad credit after a divorce

Unfortunately, debt problems, bad credit or no credit history are fairly common side-effects of a relationship ending – and this can come at just the time when you need some extra help with money. The good news is that it's possible to establish or rebuild your credit after divorce or separation, once the dust has settled and you're ready to regain your financial independence.


One way to do this is with a Vanquis credit card. By borrowing and repaying regularly within manageable limits, you can establish a good credit rating over time, which can eventually pave the way to more competitive forms of credit, such as lower APR products or higher starting credit limits.