Getting Married? 6 Questions You Need to Ask Before Joining Your Finances

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When you’re getting ready to take your relationship with a significant other to the next level, one of the most important subjects to talk about is money.

And one of the most important money subjects is debt.

The New York Fed reports that Americans carry more than $12 trillion in debt. What’s more, almost $750 billion of that debt is through credit cards. And, of course, Americans owe more than $1 trillion in student loan debt.

With so much debt floating around, there is a good chance your significant other has debt. Therefore, here’s a review of how to address debt management within your relationship and, if necessary, protect yourself going forward.

Debt management and marriage 101

Before you say “I do,” consider asking the following six questions before hitching your finances to your partner permanently.

1. Is it possible to hide debt from your spouse?

In most cases, your debt can’t be discussed with anyone who hasn’t cosigned it.

However, your spouse is a different story in most situations according to Gerri Detweiler, head of market education for business credit company Nav.

“It’s hard to hide debt from your spouse,” Detweiler explains. “If it goes into collections, a collection agency can discuss it with your spouse.”

This is true even if your spouse isn’t a cosigner. The only exception is if you live in a state that requires spousal consent.

So if you have debt and you’re thinking about getting married, it’s a good idea to come clean before you tie the knot.

Of course, it’s still possible to hide your financial sins from your partner, even if you’re married and combine finances.

According to a survey commissioned by ForbesWoman and the National Endowment for Financial Education (NEFE), 31 percent of American adults admit to lying about money.

2. Should you cosign your partner’s debt?

When you join your life to someone else’s, it’s tempting to say “what’s yours is mine — including debt.”

It’s a noble sentiment, and it can help when you’re paying off debt as a couple. But that doesn’t mean you should cosign on your partner’s debt or add your name to their debt obligations.

“Generally, debts incurred before one marries aren’t inherited by a spouse,” says Detweiler.

That changes, though, if you decide to cosign a loan or add your name to your partner’s.

“If they default on the cosigned loan, you could wind up with the full responsibility for the debt,” explains Detweiler.

This applies even after you break up. Let’s say a judge instructs your ex to keep paying on a debt. If your name is still on the loan, it’s also your responsibility, too. And, if your ex doesn’t make payments, creditors might still come after you as the cosigner.

If you break up with someone and you’re attached to any of their loans, it’s a good idea to see if you can get a cosigner release. Although it’s not always possible, it’s worth a try.

3. How will their debt cancellations affect your taxes?

Your partner’s current debt isn’t all you have to worry about, either.

Perhaps your spouse-to-be doesn’t have debt right now, but their debt was canceled in the past as part of a debt management agreement. If you marry, you need to double-check the implications of filing jointly.

“The amount they saved by settling may be reported as income,” says Detweiler. “This can affect your tax bill if you file jointly.”

Consult with a tax professional before you file your taxes and run the numbers. Look at different scenarios to ensure that your spouse’s canceled debt isn’t going to mean a bigger tax bill.

You may find that you’re better off filing separately until their canceled debt is no longer an issue.

4. Should you get joint bank accounts?

Many couples open joint bank accounts to make it easier to manage their finances together. You can also open a joint account for all types of loans, including credit cards.

And in many cases, even if one of you has debt, this doesn’t end up being a huge problem. You can use your joint bank account to pay shared bills and take care of household expenses.

Things can get ugly, however, if your significant other or spouse is sued.

“If you have joint accounts and your spouse gets a judgment against them, or has one already, it may be possible for the judgment creditor to take that money,” says Detweiler. That can include money you’ve put into that account, too.

For the most part, whether you’re married or not, a joint account means the money is equally both of yours, says Detweiler. That’s why in some cases the money you add to the joint account can be subject to the terms of a judgment against your spouse.

Therefore, if you aren’t sure about your partner’s situation, avoid opening joint bank accounts. You’ll just have to find another way to split the bills and pay attention to who’s responsible for what. But that’s better than having your money taken away because of your partner’s unpaid debts.

5. Will their debts affect your credit?

Remember, if your partner runs up big bills on a joint account, you are responsible for them just as much as your partner.

That means that if they don’t pay their bills or loans, and your name is associated with their accounts, your credit score could take a hit. Therefore, if the relationship ends, double-check your credit history to make sure things aren’t mistakenly assigned to you.

“Make sure information isn’t incorrectly commingled,” says Detweiler. “Your individual accounts shouldn’t appear on each other’s credit reports, but mistakes do happen.”

You can get a little help from the courts by adding a written statement to your credit file claiming you are no longer associated with those accounts. But there’s not much you can do if a partner runs up bills in a joint account with your name still on it and refuses to pay.

6. What about community property laws?

According to Nolo, debt acquired during a marriage is considered community debt. No matter whose name is on the account.

Essentially, you could be equally liable for debt your spouse acquires on their own — even if your name isn’t anywhere near it.

There are different rules, depending on who benefitted from the purchase. There are also formulas that can be used to determine your liability. Check your state’s community property laws to see what the rules are.

How to protect your finances (just in case)

While you may combine your finances to some degree as a couple, consider keeping some of your assets separate.

Even though my ex-husband and I had a “big pot” arrangement for most of our money, we also made it a point to keep some things separate during our marriage. We each had our own credit cards, retirement accounts, and individual bank accounts.

So, even though we did have a joint bank account, we each also had our own assets and credit resources. That way we were both protected.

In the long-run, it turned out to be a good thing. It made it easier to separate our finances when our marriage dissolved. Plus, I had peace of mind knowing that I had some of my own assets, just in case.

As you get ready to join finances with another person, consider keeping some of your money separate and potentially protecting yourself from your partner’s debts. While it’s ideal to approach debt management jointly as a couple, you never want to risk your own credit score or livelihood in the process.

Interested in a personal loan?

Here are the top personal loan lenders of 2018!
LenderAPR RangeLoan Amount 
1 Includes AutoPay discount. Important Disclosures for SoFi.

SoFi Disclosures

  1. Personal LoansFixed rates from 7.08% APR to 15.37% APR (with AutoPay). Variable rates from 5.81% APR to 14.11% APR (with AutoPay). SoFi rate ranges are current as of August 10, 2018 and are subject to change without notice. Not all rates and amounts available in all states. See Personal Loan eligibility details. Not all applicants qualify for the lowest rate. If approved for a loan, to qualify for the lowest rate, you must have a responsible financial history and meet other conditions. Your actual rate will be within the range of rates listed above and will depend on a variety of factors, including evaluation of your credit worthiness, years of professional experience, income and other factors. See APR examples and terms. Interest rates on variable rate loans are capped at 14.95%. Lowest variable rate of 5.81% APR assumes current 1-month LIBOR rate of 2.07% plus 4.175% margin minus 0.25% AutoPay discount. For the SoFi variable rate loan, the 1-month LIBOR index will adjust monthly and the loan payment will be re-amortized and may change monthly. APRs for variable rate loans may increase after origination if the LIBOR index increases. The SoFi 0.25% AutoPay interest rate reduction requires you to agree to make monthly principal and interest payments by an automatic monthly deduction from a savings or checking account. The benefit will discontinue and be lost for periods in which you do not pay by automatic deduction from a savings or checking account. The benefit will discontinue and be lost for periods in which you do not pay by automatic deduction from a savings or checking account.
  2. Minimum Credit Score: Not all applicants who meet SoFi’s minimum credit score requirements are approved for a personal loan. In addition to meeting SoFi’s minimum eligibility criteria, applicants must also meet other credit and underwriting requirements to qualify.
  3. SoFi Personal Loans are not available to residents of MS. Maximum interest rate on loans for residents of AK and WY is 9.99% APR, for residents of IL with loans over $40,000 is 8.99% APR, for residents of TX is 9.99% APR on terms greater than 5 years, for residents of CO, CT, HI, VA, SC is 11.99% APR, and for residents of ME is 12.24% APR. Personal loans not available to residents of MI who already have a student loan with SoFi. Personal Loans minimum loan amount is $5,000. Residents of AZ, MA, and NH have a minimum loan amount of $10,001. Residents of KY have a minimum loan amount of $15,001. Residents of PA have a minimum loan amount of $25,001. Variable rates not available to residents of AK, TX, VA, WY, or for residents of IL for loans greater than $40,000.
  4. Terms and Conditions ApplySOFI RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS AT ANY TIME WITHOUT NOTICE. To qualify, a borrower must be a U.S. citizen or permanent resident in an eligible state and meet SoFi’s underwriting requirements. Not all borrowers receive the lowest rate. To qualify for the lowest rate, you must have a responsible financial history and meet other conditions. If approved, your actual rate will be within the range of rates listed above and will depend on a variety of factors, including term of loan, a responsible financial history, years of experience, income and other factors. Rates and Terms are subject to change at anytime without notice and are subject to state restrictions. SoFi refinance loans are private loans and do not have the same repayment options that the federal loan program offers such as Income Based Repayment or Income Contingent Repayment or PAYE. Licensed by the Department of Business Oversight under the California Financing Law License No. 6054612. SoFi loans are originated by SoFi Lending Corp., NMLS #1121636.
    (www.nmlsconsumeraccess.org)

2 Includes AutoPay discount. Important Disclosures for Payoff.

Payoff Disclosures

  1. All loans are subject to credit review and approval. Your actual rate depends upon credit score, loan amount, loan term, credit usage and history. Currently loans are not offered in: MA, MS, NE, NV, OH, and WV.

3 Important Disclosures for FreedomPlus.

FreedomPlus Disclosures

  1. All loans available through FreedomPlus.com are made by Cross River Bank, a New Jersey State Chartered Commercial Bank, Member FDIC, Equal Housing Lender. All loan and rate terms are subject to eligibility restrictions, application review, credit score, loan amount, loan term, lender approval, and credit usage and history. Eligibility for a loan is not guaranteed. Loans are not available to residents of all states – please call a FreedomPlus representative for further details. The following limitations, in addition to others, shall apply: FreedomPlus does not arrange loans in: (i) Arizona under $10,500; (ii) Massachusetts under $6,500, (iii) Ohio under $5,500, and (iv) Georgia under $3,500. Repayment periods range from 24 to 60 months. The range of APRs on loans made available through FreedomPlus is 4.99% to a maximum of 29.99%. APR. The APR calculation includes all applicable fees, including the loan origination fee. For Example, a four year $20,000 loan with an interest rate of 15.49% and corresponding APR of 18.34% would have an estimated monthly payment of $561.60 and a total cost payable of $7,948.13. To qualify for a 4.99% APR loan, a borrower will need excellent credit on a loan of $15,000 with a term of 24 months, and qualify for at least two of the following discounts: (1) add a co-borrower who has sufficient income; (2) use at least fifty percent of the loan proceeds to directly pay off existing debt; or (3) show proof of having at least forty-thousand dollars in retirement savings – contact FreedomPlus for further details.

4 Important Disclosures for Citizens Bank.

Citizens Bank Disclosures

  1. Personal Loan Rate DisclosureFixed interest rates from 6.49% – 19.49% (6.49% – 19.49% APR) based on applicable terms. Lowest rates range from 5.99%-18.99% (5.99%-18.99% APR), are for eligible applicants, require a 3-year repayment term, and include our Loyalty and Automatic Payment Discounts of 0.25 percentage points each, as outlined in the Loyalty Discount and Automatic Payment Discount disclosures. Subject to additional terms and conditions, and rates are subject to change at any time without notice. Such changes will only apply to applications taken after the effective date of change.
  2. Loyalty Discount: The borrower will be eligible for a 0.25 percentage point interest rate reduction on their loan if the borrower has a qualifying account in existence with us at the time the borrower has submitted a completed application authorizing us to review their credit request for the loan. The following are qualifying accounts: any checking account, savings account, money market account, certificate of deposit, automobile loan, home equity loan, home equity line of credit, mortgage, credit card account, student loans or other personal loans owned by Citizens Bank, N.A. Please note, our checking and savings account options are only available in the following states: CT, DE, MA, MI, NH, NJ, NY, OH, PA, RI and VT. This discount will be reflected in the interest rate and Annual Percentage Rate (APR) disclosed in the Truth-In-Lending Disclosure that will be provided to the borrower once the loan is approved. Limit of one Loyalty Discount per loan, and discount will not be applied to prior loans. The Loyalty Discount will remain in effect for the life of the loan.
  3. Automatic Payment Discount: Borrowers will be eligible to receive a 0.25 percentage point interest rate reduction on their Citizens Bank Personal Loan during such time as payments are required to be made and our loan servicer is authorized to automatically deduct payments each month from any bank account the borrower designates. If our loan servicer is unable to successfully withdraw the automatic deductions from the designated account two or more times within any 12-month period, the borrower will no longer be eligible for this discount.

5 Important Disclosures for LendingPoint.

LendingPoint Disclosures

  • Loan approval is not guaranteed. Actual loan offers and loan amounts, terms and annual percentage rates (“APR”) may vary based upon LendingPoint’s proprietary scoring and underwriting system’s review of your credit, financial condition, other factors, and supporting documents or information you provide. Origination or other fees from 0% to 6% may apply depending upon your state of residence. Upon LendingPoint’s final underwriting approval to fund a loan, said funds are often sent via ACH the next non-holiday business day. LendingPoint makes loan offers from $2,000 to $25,000, at rates ranging from a low of 15.49% APR to a high of 34.49% APR, with terms from 24 to 48 months. The loan offer(s) shown reflect a 28 day payment cycle which is being offered as a courtesy as many of our customers are paid on a biweekly schedule and thus this may better align the loan payment dates with your actual income receipt schedule.

6 Important Disclosures for LendingClub.

LendingClub Disclosures

All loans made by WebBank, Member FDIC. Your actual rate depends upon credit score, loan amount, loan term, and credit usage & history. The APR ranges from 6.16% to 35.89%. For example, you could receive a loan of $6,000 with an interest rate of 7.99% and a 5.00% origination fee of $300 for an APR of 11.51%. In this example, you will receive $5,700 and will make 36 monthly payments of $187.99. The total amount repayable will be $6,767.64. Your APR will be determined based on your credit at time of application. The origination fee ranges from 1% to 6% and the average origination fee is 5.49% as of Q1 2017. There is no down payment and there is never a prepayment penalty. Closing of your loan is contingent upon your agreement of all the required agreements and disclosures on the www.lendingclub.com website. All loans via LendingClub have a minimum repayment term of 36 months or longer.


7 Important Disclosures for Earnest.

Earnest Disclosures

  1. Earnest does not lend in Alabama, Delaware, Kentucky, Nevada, or Rhode Island.

8 Important Disclosures for Avant.

Avant Disclosures

* The actual rate and loan amount that a customer qualifies for may vary based on credit determination and other factors. Funds are generally deposited via ACH for delivery next business day if approved by 4:30pm CT Monday-Friday. Avant branded credit products are issued by WebBank, member FDIC.

** Example: A $5,700 loan with an administration fee of 4.75% and an amount financed of $5,429.25, repayable in 36 monthly installments, would have an APR of 29.95% and monthly payments of $230.33


* Important Disclosures for Upgrade Bank.

Upgrade Bank Disclosures

* Your loan terms are not guaranteed and are subject to our verification and review process. You may be asked to provide additional documents to enable us to verify your income and your identity. This rate includes an Autopay APR reduction of 0.5%. By enrolling in Autopay your payments will be automatically deducted from you bank account. Selecting Autopay is optional. Annual Percentage Rate is inclusive of a loan origination fee, which is deducted from the loan proceeds. Late payments or subsequent charges and fees may increase the cost of your fixed rate loan. All loans made by WebBank, member FDIC. Please refer to Upgrade’s Terms of Use and Borrower Agreement for all terms, conditions and requirements.

** Accept your loan offer and your funds will be sent to your bank via ACH within one (1) business day of clearing necessary verifications. Availability of the funds is dependent on how quickly your bank processes this transaction. From the time of approval, funds should be available within four (4) business days.

7.73% – 29.99%$1,000 - $50,000Visit Upstart
5.81% – 15.37%1$5,000 - $100,000Visit SoFi
6.87% – 35.97%*$1,000 - $50,000Visit Upgrade
8.00% – 25.00%2$5,000 - $35,000Visit Payoff
4.99% – 29.99%3$10,000 - $35,000Visit FreedomPlus
5.99% – 18.99%4$5,000 - $50,000Visit Citizens
15.49% – 34.49%5$2,000 - $25,000Visit LendingPoint
6.16% – 35.89%6$1,000 - $40,000Visit LendingClub
5.49% – 18.24%7$5,000 - $75,000Visit Earnest
9.95% – 35.99%8$2,000 - $35,000Visit Avant
Our team at Student Loan Hero works hard to find and recommend products and services that we believe are of high quality and will make a positive impact in your life. We sometimes earn a sales commission or advertising fee when recommending various products and services to you. Similar to when you are being sold any product or service, be sure to read the fine print understand what you are buying, and consult a licensed professional if you have any concerns. Student Loan Hero is not a lender or investment advisor. We are not involved in the loan approval or investment process, nor do we make credit or investment related decisions. The rates and terms listed on our website are estimates and are subject to change at any time. Please do your homework and let us know if you have any questions or concerns.