When you get married, the last thing you are thinking about is how credit will affect your marriage. Your financial history doesn’t change when you tie the knot. Your history, whether good or bad, will remain the same as will your spouse’s.
No matter if your finances are perfect and you qualify for all the
interest-free offers out there, your financial history will not be affected by
your spouse’s years of neglect, divorce, or identity theft experiences. The act
of getting married to your spouse will not automatically bring your score down.
Even if you live in a community property state, taking the last name of your
spouse won’t change anything.
Since your credit is attached to your Social Security number, you can’t give
your spouse your financial history. Even if you change your name, your Social
Security number will stay the same. This also means that your new name will not
wipe out your prior history, your old name is just now considered an alias.
When you make your accounts joint accounts, both of your scores will be used as
factors in the approval process. This is where joining your financial history
can be a benefit. If your financial history is worse than your spouses, then
your spouse’s good financial history can help raise your ability to get a loan.
This can be advantageous if you have an existing loan with a high-interest
rate. By adding your partner to the loan, you are pretty much reapplying for
that loan and the existing terms will be refinanced.
Now, that also means your bad financial history will be bringing the overall
chance of the joint account to enjoy the benefits of your spouse’s good
financial history. In some instances, it is better to have the partner who has
a great financial background to apply for the loan on their own, allowing you
to achieve the best terms and interest rate.
As you and your spouse now pay on that account, the good payment record will be
reported on both of your reports. This will now improve your less than stellar
score. It may take time but having the spouse that is more financially
responsible will ultimately fix that bad history.
If you plan ahead, combining your financial history can ultimately help your
marriage. If your spouse has a good history, having you added as an authorized
user to a credit card account will cause the account’s history to show up on
your report. This can have an immediate positive effect on your financial
history.
Keep in mind that if you open a joint account together, both of your histories
will be reviewed, and you will both be held liable for the account. If only the
spouse with a good history opens that account and lists the other spouse as an
authorized user, the spouse with the good history will only be liable for the
account and only their history reviewed.
Just remember that when you are sharing finances in marriage, you need to be
proactive in maintaining a good financial history. Otherwise, the benefits of
sharing finances as a married couple will be reversed.
