Does Your Spouse’s Credit Affect Your Credit Score?
Tying the knot can change the way you manage your financial life if you’re merging money with your new spouse. That includes sharing bank accounts and bills but you may be wondering whether it also means sharing credit.
If your spouse has poor credit, for instance, you may be concerned that your credit score could be affected. On the other hand, if you have a thin credit file you might be interested in whether your spouse’s good credit could give your score a boost.
There are some myths surrounding credit and marriage that are best put to rest before the honeymoon ends. Here’s a closer look at how getting married can (and can’t) affect your credit.
Will Getting Married Hurt or Help Your Credit?
Getting married doesn’t help your credit or hurt it directly. You might assume that getting married means you and your spouse will share a credit report and score but this isn’t the case.
Instead, you and your spouse each maintain your own credit file just the same as you did before you were married. Marriage doesn’t automatically transplant their credit history onto your credit file or vice versa.
Changing your name after marriage won’t hurt or help your credit either. Any name change will show up on your credit history but it isn’t factored into your credit scores.
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When Your Spouse’s Credit Can Affect You
Marriage alone won’t change your credit history. But you could see credit file and credit score changes if you decide to share credit accounts with your spouse.
For example, say you have thin or poor credit. You ask your spouse to add you to one of their credit cards as an authorized user. The activity for that account can then show up on your credit reports, even though as an authorized user you’re not liable for charges made to the card.
Likewise, opening a joint credit account would also show up on both your credit reports. If you were to take out a car loan or mortgage together, for example, you’d both see the account on your credit history. You’d also be equally liable for the debt.
How joint debts or authorized user accounts affect your credit ties in to how you’re managing those accounts. Remember, credit scores are based on the following factors:
- Payment history (35% of your score)
- Credit utilization (30% of your score)
- Credit age (15% of your score)
- Types of credit used (10% of your score)
- Inquiries for new credit (10% of your score)
Making late payments on a shared credit account or running up a balance that’s close to your available limit could have a negative impact on both your scores. Closing shared accounts or applying for multiple loans or lines of credit in a short span of time could also lead to a credit score ding.
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What If My Spouse Has Bad Credit?
If your spouse has poor credit because of defaults, charge-offs or something more serious, such as a bankruptcy proceeding, that won’t affect your credit report and score. But it could make it more difficult to get shared credit accounts if they have a low credit score.
For example, when applying for a mortgage as a couple, lenders will use the lower credit score out of the two for approval decisions. If you’re able to get approved for a loan or line of credit together, the interest rate you might pay could be higher than you’d like, even if you have good credit.
Applying for joint credit when one of you has poor credit history has its pros and cons. On the pro side, sharing credit accounts could help to improve the score of the spouse with poor credit if that account is being managed responsibly. On the other hand, the spouse with good credit could see their score suffer if the other spouse isn’t diligent about paying the bills on time.
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How to Manage Credit in Marriage
If you’re concerned about credit score impacts after marriage, here are a few tips for managing credit together:
- Discuss your credit history. One of the easiest ways to avoid conflicts over credit is to let one another know where you stand, score-wise. This can help with making decisions about whether to share credit or not.
- Practice good credit habits. Paying bills on time, keeping credit card balances low and applying for new credit sparingly can help you build positive credit history individually.
- Understand what sharing credit means. Before adding a spouse as an authorized user or applying for a joint loan, make sure you’re clear on how that can translate to credit score impacts. Discuss how you’ll pay back what you borrow to avoid credit mistakes, like late payments or default.
Sharing credit as a couple is a big decision and it’s important to know how it can affect you financially. Checking your credit reports regularly can help you see how shared accounts may be impacting your scores.
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Rebecca Lake is a freelance writer specializing in personal finance,
credit and debt. She’s a contributor to U.S. News and World Report,
Forbes Advisor and The Balance and her work has appeared online at CreditCards.com,
Money-Rates.com and dozens of other top publications.