How to Recover from Credit Damage Caused by Family, Friends, or Divorce

At Starting Now, we hear heartbreaking stories every day, stories about people who did the right thing, trusted someone they loved, and are now dealing with damaged credit. Whether it’s a family member opening accounts in your name, a friend who didn’t repay a loan you cosigned, or an ex-spouse who walked away from shared debt, the impact can be long-lasting.

If you’re searching for how to fix credit ruined by someone else, know this: you’re not alone, and there are ways to recover.

Real Situations That Hurt Credit Scores

Here are common credit challenges our clients face:

• Credit cards opened fraudulently under a minor’s name, usually by a relative, damaging the young adult’s credit before they even start building it.
• Cosigning for a loan or credit card for a friend or family member, only to be left responsible when they stop paying.
• Letting someone use your credit for a utility bill, car lease, or apartment and they never pay the debt.
• Joint credit cards or loans during marriage where one spouse refuses to pay after a divorce, even if the debt is still under both names.

These situations often involve deep trust and emotional stress. But no matter how it happened, credit damage from someone else’s actions can be repaired—and you deserve support through that process.

How These Situations Affect Your Credit Score

When someone misuses your trust or your credit, the consequences can include:

• Late payments and accounts in collections

• Lower credit scores

• Difficulty getting approved for loans, housing, or jobs

• Emotional toll, feeling guilt, shame, or frustration

• In some cases, legal or financial liability, even after divorce

How to Recover from Credit Damage Caused by Others

Whether it’s identity theft, a broken financial agreement, or a failed cosigning situation, here’s how to take control of your credit:

✅ If Someone Opened Credit in Your Name Without Permission

This is considered credit fraud or identity theft, even if the person is a relative.

Request your credit reports from all three bureaus at annualcreditreport.com.

Report the fraud to the FTC at identitytheft.gov.

File a police report, even if it’s a family member—this can help your dispute.

Place a fraud alert or credit freeze to protect your credit file.

Dispute fraudulent accounts with each credit bureau.

✅ If You Cosigned and They Didn’t Pay

You’re legally responsible, even if you didn’t benefit from the loan.

Call the lender immediately to explain the situation and ask about repayment options.

Make minimum payments if possible to avoid more damage.

Monitor your credit report for any changes or additional issues.

Work with a nonprofit credit counselor to explore debt management plans or solutions.

✅ If Your Ex-Spouse Won’t Pay Joint Debts After Divorce

This is a very common post-divorce credit issue.

Understand that creditors don’t honor divorce decrees. If your name is on the account, you’re still responsible.

Contact the creditor to see if your name can be removed or if the debt can be refinanced.

Keep making payments if you can, to avoid collections or lawsuits.

Consult a lawyer if your ex is violating court-ordered responsibilities.

Keep good records of all payments and communication.

How to Protect Yourself from Future Credit Damage

Don’t cosign unless you’re prepared to pay the full debt.

Use credit monitoring or get your reports at least once a year.

Avoid joint credit accounts unless you’re 100% confident in the other person.

Talk to children and teens about protecting their identity and credit.

Practice setting healthy financial boundaries, even with people you love.

Need Help Fixing Your Credit After Someone Else Damaged It?

You don’t have to do this alone. Starting Now offers a credit counseling program to help you recover, rebuild, and protect your credit. Whether the damage came from fraud, cosigning, or a divorce, we’re here to help you take the next step.

Let’s Start Fixing It Together

If you’re ready to take back control of your credit, contact Starting Now today. We’ll walk you through the options, explain what’s possible, and help you feel empowered again.