Marriage is a union in many ways.
One partner’s credit problems can become part of the union, creating new personal finance challenges for the married couple.
But your spouse’s past credit problems won’t affect your score directly.
Marriage and Your Credit Score
Here are some things to know about your partner’s debt before getting married:
Your Credit Reports Won’t Merge
If your partner has a poor credit score or credit report, this credit history won’t be transferred or combined with yours when you get married.
That’s because a credit score or report is tied to each person’s Social Security number.
You don’t merge your Social Security numbers upon marriage so your credit histories don’t merge either.
Each person will still have his or her own credit score, and both partners should continue checking their credit reports each year.
Get a Free Copy of Your Credit Report
Changing Names Won’t Change Scores
Changing your last name to match your spouse’s won’t affect your credit score. Some married couples change or combine both their last names. This doesn’t affect your credit profile either.
Reporting the name change to creditors is important. Even if you don’t report the name change, it’ll make its way onto your credit report sooner or later.
But a name change won’t mean starting a new credit history from scratch.
Your old name will be listed as an alias, and your new name will be added to your report. This is why it’s important to report the change yourself. You want to make sure the credit bureaus get it right so you don’t have extraneous aliases.
But name change or no, you’ll still have your same old credit score upon marriage, for better or worse.
Even in a joint or community property state, if your name isn’t on an account, then activity on that account won’t be reported on your credit report.
Spouse’s Poor Credit Won’t Hurt Your Score
Getting married won’t lower your credit score. A spouse’s poor credit history won’t impact the other partner’s past credit history.
Even if you have joint accounts together, you’ll each still have separate credit scores.
That being said, your financial decisions as a couple will likely affect each other’s credit scores going forward.
Marriage can create an opportunity to build credit together — or one spouse’s financial decisions could adversely affect both spouses’ credit scores.
Effects of Joint Accounts
Married couples often combine bank accounts, creating a joint account that can make paying bills and saving money together a lot easier.
Information about this joint account will go onto both partner’s separate credit reports which means one partner’s financial decisions could affect the other spouse’s credit score.
For example, if you have a joint line of credit and your partner makes several late payments without your knowledge, the negative payment history will become part of your credit report as well as your spouse’s credit report.
The same is true for joint credit cards. Even though each cardholder has a different credit card number, any activity on the account impacts the credit of both account holders.
The credit card lender doesn’t report late payments or high credit utilization ratios based on which partner spent the money; the credit card debt and payment history appears on both partners’ credit reports.
Not All Accounts Are Joint Accounts
Getting married doesn’t automatically connect you to your spouse’s accounts or vice versa. You won’t automatically be an authorized user or a co-signer either. Your name won’t automatically appear on your spouse’s checking account.
Spouses have to add each other to their pre-marriage financial accounts. Adding your spouse to your checking account makes sense; adding your spouse to your car loan may not be necessary unless you’re actively trying to build credit.
We’ll get into this concept more below.
Buying a Home Together Can Be Tricky
Since credit histories for married couples aren’t combined, each partner will have to show his or her credit history when applying for a loan, such as a home mortgage.
This can get dicey if one person has a low credit score, since two incomes and two good credit scores are often needed to qualify for a mortgage loan. Underwriters will also want to know about both partners’ incomes to calculate debt-to-income ratios.
If you or your spouse has a bad credit score, you could pay higher interest rates and fees for a home loan.
Improving a partner’s credit score before applying for a home loan could increase your chances of approval.
Keep Separate Credit Cards
A joint credit card account is a good idea, but couples may also want to have one separate credit card in each person’s name for a few reasons.
First, it will help each spouse build credit individually.
Second, if they ever get divorced, a separate credit card account can be useful to have if their joint accounts are closed.
A divorce won’t affect credit scores directly, but joint accounts could be negatively affected if one person overdraws an account and doesn’t pay the bill on time.
That could lower the credit scores of both ex-partners.
So, Does Getting Married Affect Your Credit Score?
Overall, marriage won’t affect your credit profile as much as you might think.
Still, it’s a good idea to have a few conversations about your credit histories as a couple before getting married.
A person’s credit history tends to reflect the person’s financial decisions, and these decisions can affect both partners going forward.
Marriage: Working Together to Rebuild Bad Credit
If you have bad credit, or if your spouse has bad credit, you can work together to increase these lower scores which will make you stronger borrowers together.
The same holds true if either partner has no credit record.
Here are a few ways you can build credit together:
- Authorized User: If you have a credit card in good standing, you could add your spouse as an authorized user. Your positive payment history could help your spouse’s credit file some. Not all credit card issuers report data to an authorized user’s credit so you may want to ask first.
- Co-Signing: Next time the spouse with weak credit needs a car, the spouse with better credit could co-sign on the car loan. A co-signer helps underwriters approve the loan. Getting a loan creates an opportunity for the credit-challenged spouse to make regular, on-time payments which will jump start a credit repair project.
- Co-Borrowers: Co-borrowing puts both spouse’s names on a joint loan and makes each spouse equally responsible. If you’re serious about credit repair, you could refinance an existing loan with both spouses’ names on the loan.
How to Talk About Credit Reports Together
It’s normal to enter marriage with individual student loans, auto loans, and possibly even a mortgage loan.
Your new marital status won’t affect these existing accounts or your FICO score, even if your spouse’s credit score is a lot lower than yours.
However, your financial decisions and spending habits going forward as a couple could affect each other’s credit scores. So it’s healthy to talk through these issues as a couple.
You could start by getting your free credit reports at annualcreditreport.com. Each year you’re entitled to a free credit report from all three credit bureaus, Equifax, Experian, and TransUnion.
Looking over each other’s credit files is a good idea for several reasons:
- You get a reliable picture of the debt you’ll face together so you can make more informed financial decisions.
- You can see whether inaccuracies are pulling down your or your spouse’s credit score.
- You can make sure your names and addresses appear correctly which can clear up confusion and help avoid identity theft.
Your credit affects your financial decisions, and finances are a big part of any marriage.
Monitoring Your Credit Score
Monitoring your credit reports has gotten a lot easier lately.
Free services such as Credit Sesame and Credit Karma will send you updates about your score via text or app.
In ordinary times the federal government allows everyone to get a free credit report from each credit bureau once a year.
Now, because of the coronavirus pandemic, you can get a free credit report once a week at annualcreditreport.com.
This special provision is set to expire in April of 2021.
You don’t want to be surprised by your spouse’s credit or your own poor credit when you apply for something as important as a mortgage.
By monitoring your credit every month you’ll know about inaccuracies and mistakes before they cause problems.
Elements of a Healthy Credit Score
Lenders check your FICO score which combines data from the three credit bureaus.
If you’d like to establish better credit scores, focus on these areas first:
- Payment History: This comprises 35% of your FICO score. Making late payments or missing payments will hurt your credit.
- Credit Use: Maxed out credit cards show lenders you’re using all of your available credit. This will lower your credit score because it accounts for 30% of the FICO scoring model. You can help yourself by keeping some paid-off credit card accounts open but not using them.
- Other Factors: Keeping a variety of credit accounts open, keeping the same accounts open year after year, and limiting new credit inquiries will help buoy your credit scores.
Deleting Inaccurate Credit Data
Married couples who monitor their credit histories together will likely notice inaccuracies in their credit reports.
Inaccurately reported late payments and account balances can wreak havoc on a credit score. You can dispute inaccurate data yourself.
Married couples who don’t have lots of time to spend on the phone or writing letters may prefer hiring a professional credit repair company.
Credit repair companies can do the legwork for you. We recommend Credit Saint. This company can send dispute letters and follow up on them for you.