Hey everyone. Hope everyone's week is off to a good start. Very
cool yet sunny in Montreal. This week I've been inspired to speak about women,
more specifically women that
go through divorce or get taken advantage of by their spouse or partner.
In 2013, I worked on a number of divorce
and separation cases. In many of those cases either the women wanted to keep the
family home or took their share of the profits and bought a new home for
themselves (and often the children). I highly suggest any woman in a
relationship or marriage to build
independent credit of their
partner. I am not paranoid and yes I still believe in the institution of
marriage, however should anything happen or should you experience divorce it's
always important to have credit. You might not be able to keep the house or
your lender options may be very limited. When in doubt ask and plan
ahead.
Example 1: Divorced with joint
credit
I have one client that has three kids,
works part time and she wanted to refinance to buy her x-husband out in order
to keep the house. I found an excellent mortgage program but I had to get an
exception from the lender because post-divorce she was removed from all the
joint debts. Luckily she had just the minimum independent credit history to
qualify for this program. Quite the close call!
Example 2: Common Law & Helping the Wrong Person
A more tragic and heartbreaking situation
is when someone is in a common law relationship and helping the wrong person. In this case my client was
taken advantage of by her partner. My client was committed to her partner and
wanted to help him with his debts and give him a cash infusion for his
business. Before she knew it he took the money and left. My client's credit
cards were at limit and with a salaried job she was stuck paying. Over time she
got more and more behind. By the time she sold the house and paid off all debts
the credit damage was already done. Presently, I started to build a case for Equifax to
see if the severe lates can be removed off her report. Presently she is trying
to re-start her life with her daughter by buying a new home together. With the
severity of lates all "A banks and lenders" won't be able to finance
an insured purchase (she does not have enough down payment to work with an
alternative or B lender). I will keep everyone updated on this story.
Both examples are sad to hear but unfortunately more and more
common. In example 1, my client should have created her own independent credit years
ago. I recommended that she create more credit today to have the necessary
credit history tomorrow. In Example 2, I wish I met her years ago just as she
was starting to become late on her debts. Many consumers don’t know what to do
in that situation or as they become late they go see their bank and their own
bank refuses or cannot help. With the emotional drain of separation or being
taken advantage of it’s hard to know what to do.
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