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When Your Spouse’s Credit Affects Yours

Posted on May 15, 2011

When two people get married, a lot of things combine, but credit histories and credit scores aren’t one of them. So, if you’re marrying someone who has bad credit, you don’t have to worry that their bad credit will drag yours down simply because you’ve been joined in holy matrimony. You do have to worry, however, if you’re applying for joint credit together, if your spouse has access to your accounts, or if your spouse has bad spending habits.

Applying for Joint Credit

Now that you’re married, there may be times when you apply for a credit card or loan with your spouse. For example, you may get a joint credit card if your spouse can’t qualify for one alone, to help your spouse repair their credit, or to make household accounting easier. Unfortunately, your spouse’s bad credit may keep you from qualifying for the best credit cards and you could wind up with a high interest rate, high fee credit card.

Applying for mortgages or car loans together will also prove difficult. Lenders have various ways of considering a joint applicant’s credit score. They may take an average of your scores or they may consider only the lowest credit score. Rarely, if ever, do they only count the highest credit score. This means you could qualify for a smaller loan, have a high down payment requirement, or have to pay a higher interest rate on the loan.

Adding a Spouse To Your Accounts

There’s a possibility that your spouse has bad credit because they have bad credit habits. If you add this spouse to your credit card accounts, their bad credit habits will reflect negatively on your credit history. For example, if your spouse runs up a high credit card balance, your credit score will be impacted. If that spouse misses a credit card payment, the late payment will go on your credit report. Look for a credit card that lets you give a spending limit for authorized users and take responsibility for the credit card payment to protect your account.

A spouse’s bad credit and bad spending habits can continue to affect you even if you don’t add them to your accounts. For example, you may have to continually bail your spouse out of financial situations because they’ve made the wrong choice. Or, if your spouse misuses household funds, that could leave you with less money or no money to take care of household expenses, or to pay your own credit cards and loans.

Spouse’s Credit in Divorce

Unfortunately, divorcing your spouse won’t eliminate issues with credit. You should continue to monitor and pay on any joint accounts even after you get a divorce, regardless of any court-ordered payment assignments. Banks will continue to hold you responsible for payments on any accounts that have you listed as a co-signer. Telling the banks your spouse is supposed to pay won’t keep them from putting late payment and delinquent notices on your credit report. It’s best to completely separate accounts in a divorce and try to take your name off any accounts that you no longer have to pay. Otherwise, try to pay off the account or make the minimum monthly payment to protect your credit.

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