Marriage and Money: Understanding Joint Credit Scores

Marriage is often accompanied by a myriad of changes. From new family members to new addresses and perhaps even a new name, it can be challenging to keep track of all the things that change once you tie the knot. In today’s culture, where it is less common for married couples to open joint bank accounts, it can be easy to forget that marriage also presents numerous financial implications, especially surrounding credit.

How Does My Credit Change After Marriage?

Simply put, marriage does not directly alter your credit. In fact, some credit bureaus, such as TransUnion and Experian, do not even record your marital status. Because credit scores are based on the contents of your personal credit reports, marital status does not and cannot factor into the way your score is calculated.

While neither you nor your spouse’s credit does not immediately change when you get married, your new spouse’s credit health can have long-term effects on your future financial plans. For example, you and your spouse may decide to take out a joint loan for a mortgage or a car.  You may also want to make an application for a joint credit card.  In that event, both your credit scores will be taken into account when your lender is considering approving the loan. If your spouse has a poor credit score, this could affect your ability to secure a loan should you be pursuing that loan as a couple. Joint accounts such as credit cards will also affect both your scores, again reemphasizing just how important it is to discuss your credit history before entering into a marriage.

What Are My Options For Loans If My Spouse Has a Poor Credit Score?

If you are married to or plan to be married to someone with a poor credit score, the concept of planning for your future may be daunting, perhaps even discouraging. Although it is not ideal to seek out loans or mortgages with a spouse with poor credit, there are avenues you can pursue while your spouse works to improve their credit that do not compromise your future goals. As long as one spouse has a relatively decent credit score and history, they can still apply for a loan individually. By applying individually, the lender can only consider that spouse’s credit history, thus increasing their chances of securing the loan for both your benefits. In the meantime, the spouse with poor credit can work to improve their score by reviewing their credit report to challenge any disputed debts, paying all their bills on time, avoiding high revolving-account balances, and generating new credit applications only as needed.

What If I’m Still Worried About How My Spouse’s Financial History Could Affect Mine?

Concerns about how your spouse’s financial situation could affect yours are common and absolutely worth exploring sooner rather than later. If you are not yet married, it may be in your best interest to look into prenuptial agreements to protect both you and your assets as you enter into your marriage. This being said, even if you are already married but have rising concerns, you still have the option to draft a postnuptial agreement that can ensure many of the same protections a prenuptial agreement can. With proper planning by a team of qualified family attorneys, such as those at Moskowitz Law Group, you can protect yourself as well as your future. Call today to get started!