In the midst of planning your wedding and a life with the one you love, one of the things you may be concerned with is how marriage will affect your credit score. Will your spouse’s credit affect yours or vice versa? In marriage, much of your life is combined; does that include your credit?
What Happens to Your Credit When You Marry
First, the good news. In most cases, nothing will happen to your credit after you exchange your “I dos.” You and your spouse will each continue to have separate credit reports containing your credit histories.
Your spouse’s credit history won’t appear on your credit report. Neither will your information appear on theirs. So, if your spouse has a negative credit history, no one will ever know that by looking at your credit report.
Fortunately, your credit score won’t drop just because you marry someone with a bad credit history. Neither will your score improve based on your spouse’s good credit. Each spouses’ credit score will continue to be calculated based on the information in their credit report.
Will a Name Change Create a New History?
If a spouse changes their name and reports the name change to credit card issuers or applies for new credit with the new name, the new name will be listed as a name variation on that person's credit report.
The myth that a wife changing her name erases her past credit history is not true. Since each person's credit report information is directly tied to their social security number, the spouse who changes their name will continue to have just one credit report with accounts under the old and new name.
Sometimes, credit bureaus erroneously create a split credit file following a name change, but this isn't typical, and it's not supposed to happen. If this happens to you, you can contact the credit bureaus to have your credit files re-merged.
When Does Your Spouse's Credit Affect Yours?
If you and your spouse jointly apply for a credit card or loan, both of your credit scores will be checked to approve the application. If one or both of you have bad credit, there’s a chance that your application won’t be approved. If the application is approved, the interest rate and fees might be higher than if the spouse with the higher credit score applied separately.
With joint accounts and authorized user accounts, the history of only that account is reported on both spouses’ credit reports, even if only one spouse uses the account.
On joint accounts, both spouses are responsible for making credit card and loan payments. Furthermore, if the account becomes delinquent, the creditor or lender will attempt to collect the delinquent amount from both spouses. With authorized user accounts, only the primary account holder is legally responsible for paying the credit card debt, but the account history will affect everyone listed on the account.
When One Spouse Has Bad Credit
When you and your spouse have different credit scores, you have to decide how you want to handle credit-based applications. Will the spouse with better credit make all the applications to get better rates? Will you apply jointly and accept higher interest rates to boost the other spouse’s credit score? These decisions depend on your financial situation and priorities.
Regardless of whether you decide to apply for new accounts together or separately, there are steps you can take to help improve a spouse's credit score.
Communicate About Money
Over half of respondents to a 2021 Policygenius survey said that they didn't know their partner's credit score. Many were in the dark about other financial information as well, including monthly spending (53%), debt (42%), and salaries (41%).
Even if you decide to keep your finances separate, you need to communicate with your spouse about money—especially if your goal is to improve either their credit score or your own.
Set Financial Goals
Payment history and amount owed make up 35% and 30% of your credit score, respectively. Paying bills on time and reducing debt are important if you want to raise a credit score. Work together to set priorities and build a budget to help you achieve your goals.
Consider a Secured Credit Card
If opening a joint account or adding one spouse as an authorized user isn't a good option, you can also consider opening a secured credit card. These cards require a deposit, but they can help users build good credit if used responsibly.