By Ronni Peel
When you get married, your hearts are joined together, but your finances remain separate. But it’s still important to discuss all your financial matters and past credit history with your spouse.
Your credit history is not going to get affected the moment you say ‘I do,’ but when you start making critical decisions, such as making purchases or opening joint accounts, your credit history gets affected.
Here is what you need to know about marriage and credit scores.
How Does a Name Change Affect My Credit History?
It’s common for a wife to take the man’s name after marriage. But many people have this misconception that a change of name erases a bad credit report.
Sorry to disappoint, but that doesn’t happen because your credit score is tied to your social security number.
A name change doesn’t change the number nor the accounts; hence the credit report information remains the same.
What Happens When One Spouse has Bad Credit History?
A bad credit report shows that your spouse has a history of loan defaults or late payments. You can discuss this together and ensure the bad report doesn’t spill over to the partner.
For instance, if you decide to get a mortgage together, the lender will probably consider the report of the person with the lowest credit history. You must know how you can handle any applications that check credit reports.
You can decide to apply for a loan jointly and help the other spouse improve their credit report. Or you can decide to let the spouse with better credit history apply instead and get better rates.
Are You Responsible for Your Spouses Debt?
Every debt your spouse incurred before getting married is individual debts, and you’re not condemned to pay them unless you do it out of goodwill. If your wife had a payday loan or a student loan before getting married, it’s their sole responsibility to finance it.
However, you’re both responsible for financing any loans you get while staying together in marriage. Other states require a spouse to help in paying the loan taken by the partner during their marriage.
What Happens When One Partner Had Filed Bankruptcy?
If one partner filed for bankruptcy before getting married, this would not affect the other’s credit score. But you must be transparent to your partner about this because it can affect future borrowing.
You might want to get a mortgage together, but the bad history may make it difficult for both of you. If your partner filed for Chapter 13 bankruptcy, they’d still need to pay the loan, which affects their income and the quality of life for both of you.
Your partner’s bad credit history won’t affect your report but can have detrimental effects on things you need to do jointly as a couple.
It’s important to address all financial issues and borrowing habits before getting married to avoid disagreements after you say ‘I do.’ You can also help your partner raise their credit score so that you increase your chances of qualifying for better loans together.
